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HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Coughlan v The Queen [2020] HCA 15 Date of Hearing: 12 February 2020 Date of Order: 12 February 2020 Date of Publication of Reasons: 24 April 2020 ORDER The appeal be allowed. Set aside the order of the Court of Appeal of the Supreme Court of Queensland made on 16 April 2019 and, in its place, order that: the appeal be allowed; the appellant's convictions for arson and attempted fraud be quashed; and verdicts of acquittal be entered on each count. On appeal from the Supreme Court of Queensland Representation S J Keim SC with M N B Thomas and D M Wells for the appellant (instructed C W Heaton QC with M J Hynes for the respondent (instructed by Director of Public Prosecutions (Qld)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Coughlan v The Queen Criminal law – Arson and attempted fraud – Appeal against conviction – Where prosecution case based on circumstantial evidence – Where appellant's house destroyed by explosion and resulting fire – Where appellant present at and seen running away from scene – Where appellant gave version of events to police consistent with innocence – Where appellant made insurance claim on house and contents in connection with fire – Where no apparent financial motive to commit offences – Where expert evidence that explosion caused by build-up of gaseous vapours – Where petrol residues found on appellant's clothes – Where no evidence of petrol residues in house – Whether open to jury to be satisfied of appellant's guilt beyond reasonable doubt – Whether prosecution excluded reasonable possibility that explosion caused by build-up of gas ignited by electrical fire. Words and phrases – "absence of apparent financial motive", "arson", "attempted fraud", "beyond reasonable doubt", "circumstantial case", "consciousness of guilt", "inference consistent with innocence", "lack of motive", "reasonable possibility", "scientific evidence". Criminal Code (Qld), ss 408C(1)(c), 459, 461(1)(a). KIEFEL CJ, BELL, GAGELER, KEANE AND EDELMAN JJ. The appellant was convicted following a trial in the District Court at Brisbane (Judge Clare SC and a jury) of arson1 and attempted fraud2. An appeal to the Court of Appeal of the Supreme Court of Queensland (Morrison JA; Fraser JA and Mullins J agreeing) against the convictions was dismissed. By special leave granted by Bell and Gageler JJ on 18 October 20193, the appellant appealed to this Court on a ground which in substance contended that the evidence is incapable of supporting the verdicts. On 12 February 2020, the Court made orders at the conclusion of the hearing, allowing the appeal, and setting aside the order of the Court of Appeal, and in its place ordering that the appeal to that Court be allowed, the convictions be quashed and verdicts of acquittal be entered on each count. These are the reasons for making those orders. The appellant and his family were living in a home in Narangba, Queensland. The appellant also owned a house in First Avenue, Bongaree on Bribie Island ("the house"). At around 6.00 pm on Saturday, 18 July 2015, there was an explosion inside the house and it was destroyed in the resulting fire. The explosion was so strong that it blew the western wall off its foundations. The heat from the fire was intense. The appellant was present at the scene and he was sufficiently close to the explosion to suffer burns to his left hand and lower back, and fairly superficial burns to his face. In its immediate aftermath, the appellant ran out through the front gate and down the road past a number of people. A youth standing near the front fence, and another youth standing near a Subaru station wagon that was parked in front of the house, each called out to him. So did a neighbour. The appellant kept running and did not respond. He rode off on a motorcycle that he had parked around the corner in a carpark earlier that afternoon ("the motorcycle"). At around 9.00 pm that same night, the appellant entered the Caboolture Police Station and reported the fire. The police who saw him accepted that he appeared to be distressed and in shock and that he reported that someone had tried to kill him. They did not smell petrol on him. He was co-operative and agreed to give the police the clothes that he was wearing at the time of the explosion. These 1 Criminal Code (Qld), s 461(1)(a). 2 Criminal Code (Qld), s 408C(1)(c). [2019] HCATrans 205. Bell Edelman included a pair of tracksuit pants and sports shoes, which subsequent testing established contained petrol residues. The appellant participated in two lengthy interviews with Detective Senior Constable Weare. The first interview was conducted at the Emergency Department of the Caboolture Hospital, where the appellant was receiving treatment for his injuries ("the first interview"). The first interview commenced late on the evening of 18 July 2015 and continued into the early hours of the following morning. The second interview was conducted on 22 July 2015 at the Royal Brisbane Hospital, where the appellant was receiving further treatment ("the second interview"). In each interview, the appellant maintained his belief that the explosion was the work of someone who was trying to harm or kill him. Sergeant Gormon of the Queensland Police Service's Gold Coast Scientific Office and Lindsay Spencer, a fire investigation officer with the Queensland Fire Service, each examined the exterior of the house on the morning after the fire. Each said that the explosion was caused by a build-up of gaseous vapours inside the house and an unknown source of ignition. Neither was able to identify the substance that gave off the gaseous vapours. Neither could exclude an electrical fire as a possible source of ignition. The following day, the appellant made a claim on his NRMA building and contents insurance policy in connection with the fire. This conduct was the subject of the second count in the indictment. It was no part of the prosecution case that the appellant had any apparent financial motive for the arson. He had personally just completed 12 months of "high-end renovations" on the house. It was the family's holiday home. Items of sentimental value were lost in the fire. The house and its contents were not over- insured. Indeed, in sentencing the appellant, Judge Clare described him as having been "underinsured". An expensive boat, which was stored in the garage adjacent to the house, was uninsured. The appellant was not in apparent financial stress. It was undisputed that the appellant had an amount of the order of $300,000 in his account with the Commonwealth Bank. The appellant did not give evidence. His version of events was before the jury in the form of the answers given in his interviews with the police. He represented himself at the trial. He appeared at times to be fixated with peripheral issues. Much of his cross-examination appears to have been directed to establishing that the investigating police were prejudiced against him and had conducted a biased investigation. It was common ground that there were ill feelings between the appellant and Detective Weare. Indeed, Detective Weare Bell Edelman acknowledged that he had not investigated anyone other than the appellant in connection with the fire and that he had told staff at the NRMA and others that he hated the appellant. Claimed inadequacies in the investigation were also prominent in the conduct of the appellant's appeal against his convictions in the Court of Appeal. It is unnecessary to refer in any detail to much of the evidence on which the appellant's submissions in the Court of Appeal depended. The rejection of those arguments may be accepted. Nonetheless, as will appear, the Court of Appeal overstated aspects of the expert evidence, which were critical to their Honours' conclusion that the evidence supported the verdicts. The prosecution's circumstantial case The respondent maintained that, when all of the circumstances are considered together, the Court of Appeal's conclusion was correct. The respondent relied on the following five circumstances: opportunity – the appellant's presence at the scene of the explosion; the cause of the explosion being from a build-up of vapours like gas or petrol; petrol residues on the appellant's clothing; (d) witnesses smelling petrol before the explosion; and flight and false alibi. To explain why the respondent's submission was rejected, it is necessary to refer at least in outline to the following evidence. The youths outside the house Four youths were in the vicinity of the house at the time of the explosion: Kye Patruno, Jack Dyke, Jessie Drayton, and Jake Long. Patruno lived next door to the house. The four were planning to go on a camping trip. Patruno and Drayton were inside Patruno's house collecting some camping gear, and Dyke and Long were waiting outside in a Subaru station wagon, when the explosion occurred. Patruno gave evidence that as he walked to the gate of his home, he noticed a strong smell of petrol. After hearing the explosion, he and Drayton ran outside. He saw the fire and he walked towards the house calling out "[i]s anybody okay? Bell Edelman Is anyone in there?" He waited for about 30 seconds but when he did not see or hear anyone at the house, he joined his friends at the Subaru. He saw a dark, shadowy figure running away. He and his friends left the scene after making sure that the emergency services had been called but before the arrival of the police. Patruno agreed that his statement about these events was made two years and four months after the explosion. He explained that the delay was occasioned by "personal issues with the Bribie Island police" and concerns for his personal safety, and that he "didn't want to bring [his] mum into it, because she has very high stress levels when it comes to danger like that". In the event, his mother persuaded him to make the statement. He agreed that he understood that it had been suggested by someone that he had set fire to the house. He agreed that Detective Weare told him that if he did not give evidence, he might be accused of the offence. He also agreed that he had been persuaded to make the statement because "Ben was having trouble with – Mr Weare – sorry – was having trouble with evidence". Patruno had spoken to a reporter for a television station and suggested that the explosion may have been triggered by a Molotov cocktail. He explained that this was just a theory. He had first spoken to uniformed police officers on the day after the fire or the following day. He was unable to recall what he had been asked. There was no evidence that Patruno told these officers that he had smelt petrol before the explosion. Dyke gave evidence that, while he waited in the Subaru, he asked Long if he could smell petrol and Long agreed that he could. Dyke said that a little later there was a big bang and he looked around and saw that the house was on fire. He got out of the car and started walking to the front gate of the house when someone came running out. He asked if "he was okay" but the man ran straight past him and kept running. In a statement given to the police closer to the time of these events, Dyke nominated Long as the one who had first commented on the petrol smell. At trial he was unable to recall who first made the comment. Long and Drayton had each moved interstate and the police did not obtain statements from either. Neither gave evidence at the trial. A number of witnesses gave evidence of seeing a man running from the scene shortly after the explosion. Two young girls described the man as having a darkish beard and riding off on a motorcycle that did not have a numberplate. It appears that the appellant did not have a beard at the time and that the motorcycle on which he rode away had a numberplate. A neighbour gave evidence of hearing the explosion and going outside and seeing a tall man who may have been dressed in black leather running. She called out to see if the man was okay, but he did not respond. She saw some kids getting into a car and heard one of them complaining, Bell Edelman "something about ... he couldn't believe this has happened, and he was still a little bit aggressive about it and got in the car with his friends and drove off". The scientific evidence Ms Maxwell, an employee of the Queensland Police Service Analytical Services Unit, gave evidence of the results of tests carried out on the appellant's clothing. On 19 July 2015 she received a pair of tracksuit pants, a pair of sports shoes, two jumpers and a t-shirt. At the time of receipt, the items were packaged in individual, fire-debris sampling bags. At this time Ms Maxwell was not aware that all five items had originally been stored together with the appellant's motorcycle helmet and his backpack and its contents in a large paper bag. Ms Maxwell tested each item using a gas chromatograph mass spectrometer. This produced a profile from which she was able to determine the presence of any ignitable liquid residues. The tracksuit pants and the shoes contained petrol residues. The two jumpers and the t-shirt contained light to medium aromatic-product-class ignitable liquid residues. In her evidence-in-chief, Ms Maxwell said that the tracksuit pants and the shoes were probably in contact with liquid petrol and the three other items were probably in contact with petrol vapours. An explanation for the light to medium aromatic-product-class ignitable liquid residues on the two jumpers and the t-shirt was that they had been stored in the same bag as the tracksuit pants and the shoes. Ms Maxwell did not give any estimate of the amount of petrol residues found on the tracksuit pants or the shoes. The minimum detection level using a gas chromatograph mass spectrometer is one microlitre in a litre: if a litre of any liquid is broken up into a million parts, Ms Maxwell could detect petrol residues in a single part. She agreed that she had on an earlier occasion made the same point by explaining that the test would yield a positive result for the presence of petrol residues from one drop of petrol in an Olympic-sized swimming pool. Ms Maxwell was unable to offer any opinion on the age of any contact between the tracksuit pants and the shoes with liquid petrol. All she could say was that petrol residues were found. Ms Maxwell was asked if there was a period of time after which she would no longer expect to obtain a positive result for petrol residues. She responded that it depended upon the sample and the length of time before the item was packaged in a fire-debris sampling bag or tin. She observed that there were no published studies on this topic. Ms Maxwell said that a colleague had tested different quantities of petrol on clothing and had been unable to detect half a millilitre of petrol four hours after the clothing had been in contact with the petrol. The tests were undertaken in support of the colleague's successful Bell Edelman candidacy for the award of a Master's degree. Ultimately, Ms Maxwell said the period of time that would need to pass before testing would no longer yield a positive result depended on the quantity of petrol residues present and the length of time before the item was packaged correctly. She explained that packaging items in a fire-debris sampling bag or tin preserves residues of accelerants. It is to be recalled that Ms Maxwell did not give an estimate as to the amount of petrol residues found on the tracksuit pants and the shoes. Ms Maxwell explained that activities such as filling up a car with petrol do not ordinarily cause an individual to have petrol on his or her clothes. Her opinion was based on a published study of the results of testing the clothing of three groups of people for the presence of petrol. The first group comprised 29 persons who had recently filled their cars with petrol. In no case were traces of petrol detected. The second group comprised 17 persons who had recently filled up a lawn mower with petrol. Traces of petrol were detected on the shoes of two persons and the components of petrol were detected on the clothing of a third person. The third group comprised a service-station forecourt attendant, a mechanic, and a person who mowed lawns professionally. Petrol was detected on the upper and lower clothing of the forecourt attendant at the end of one shift. No petrol residues were detected on the forecourt attendant's clothing after a second shift. No petrol residues were found on the mechanic's clothing or, after two shifts, on the clothing of the person who mowed lawns professionally. The fire scene examination Sergeant Gormon inspected the exterior of the house on the morning after the fire. The fire damage was so extensive that she assessed the remains to be structurally unsafe. She also had concerns that exposed fibro sheeting might contain asbestos. She was unable to determine the seat of the fire other than to state that it originated within the house. She was unable to determine the fuel source. She did not take any samples to test for the presence of accelerants because she did not enter the remains of the interior of the house. Sergeant Gormon said that, for an explosion such as this one to occur, there had to be a large amount of fuel in a gaseous form present. She was unable to rule out an electrical fire as the cause of ignition. She said that normally an electric safety officer would examine electrical items and fire-damaged wires. However, because of the extent of the damage, Sergeant Gormon considered that there was no point arranging for such an examination because there was nothing to examine and she was not going to send an electric safety officer into a scene that she assessed to be unsafe. Bell Edelman Mr Spencer also inspected the house on the morning after the fire. He, too, confined his examination to the exterior of the house. He saw no utility accessing the interior because he was able to see as much from the outside. He did not take any samples for testing as this was the responsibility of "the police forensics". Mr Spencer considered that there had been a "vapour explosion". He noted that glass had been blown into small pieces and covered a distance of about 20 metres; external verandah louvres had been blown out onto the footpath and the western wall had been blown directly off its foundations. Mr Spencer expressed the opinion that the explosion was caused by the intentional introduction of an ignition source. He could not, however, rule out an electrical fire as the source of ignition, although he observed that the remaining damage was not consistent with an electrical slow-developing fire. The appellant's account in his interviews The appellant's answers in each of the interviews were discursive. He volunteered that he was seeing a psychologist and a psychiatrist and that he suffered from mood swings. He said that he took citalopram for stress and anxiety, or mixed moods, and that he stayed over quite often at the house if he was "having a shit time … with moods up and down". He complained of having memory problems, saying "I just forget things and I can remember some things and I don't remember other things and I just don't know what it is, why it is, and it's not Alzheimer's or anything like that I don't think but as they say … I've become a bit of a hypochondriac. I've had every medical check done that you can have done. I'm fucked mentally alright." In the second interview he said that his mind was clearer, a circumstance that he attributed to the fact that he was no longer wearing Norspan patches. He complained that the patches affected his memory. In the first and second interviews, the appellant said that he had placed an advertisement on the Gumtree website offering to sell the motorcycle, which belonged to a friend, Jake Pullen. The appellant explained that he assisted friends in selling goods online from time to time. On the Wednesday or Thursday preceding the explosion, the appellant said, he had been working on renovations to the house when he was approached by a man, who inquired about purchasing the motorcycle. It had been advertised for sale at a price of $2,500. They agreed on a price of $2,300. The man offered to pay with a cheque but the appellant was unwilling to accept a cheque from a stranger. The man offered to come back the following day with cash. The appellant had other commitments on that day and they agreed to meet at 5.00 pm on Saturday, 18 July 2015. Bell Edelman The appellant said that he rode the motorcycle to the house on the Saturday afternoon. He arrived at around 5.00 pm. He parked the motorcycle around the corner as he was concerned that there might be something "dodgy" about the prospective purchaser. The appellant realised on arrival at the house that he had forgotten to bring the key. He sat at an outdoor table setting located at the back of the house and read a local newspaper while he waited for the purchaser. He did not see anyone at or near the house during this time. After an hour he decided to leave. He walked to the front of the house and "[s]omething hit me, it went bang. It sounded like a bomb ... I hit the ground. My hand was up. Someone's screaming at me and I fuckin' ran." There was a "Subaru or Forester" station wagon parked at the front of the house and a man on the driver's side was screaming at him. The appellant ran to the carpark, got on the motorcycle and rode away in fear. The appellant maintained that he believed he was being followed as he rode away from the scene. When he reached the Bruce Highway he turned right towards the Sunshine Coast and thereafter he did a series of left and right turns to avoid any pursuer. He said that he stopped by a derelict house where he had washed his face and hands under an outside tap before going to the Caboolture Police Station. The appellant's account of placing the advertisement for the sale of the motorcycle on the Gumtree website was unchallenged. Detective Weare spoke with Jake Pullen, who confirmed that he had given the appellant the motorcycle to sell. A false alibi? In the first interview, the appellant gave an account of his movements on the day of the explosion. He said that in the morning he was using a leaf blower to clean up leaves at his Narangba home. He asked his wife to help him by putting the leaves in a bag. She refused, saying that she did not want to get her clothes dirty. He "got the shits" and told her that he was going "to see the guys from the club". Later in the first interview, when Detective Weare sought to direct the appellant's attention again to the argument with his wife, the appellant responded "… have you ever lived with anyone with a medical disorder? … like are they unpredictable sometimes? … I get into a rage for no reason sometimes … [a]nd what I do is go get in the car and fuck off. I go for a drive and I just say leave me alone, don't talk to me … what I was feeling guilty about was psychological abuse by me having rages in the house." His account of his movements after leaving the Narangba home was rambling. He was asked about the whereabouts of his car and he said he believed that it was parked at his Narangba home. Bell Edelman In the second interview, the appellant said that after arguing with his wife over cleaning up the leaves, he had driven to Caboolture to pick up some strawberries. He had then left his ute at the Narangba pub. He said that while he had gone to have a drink, instead he had just sat at the pub "trying to calm myself down". In the end he got the strawberries out of the back of the car and walked home, "cause sometimes when I get stiff ... or whatever I just walk it off". He had forgotten that he had left the ute at the pub. In this Court, the respondent sought to support the Court of Appeal's conclusion, that the evidence supported the verdicts, by submitting that it was open to the jury to find that the appellant parked his car in the Narangba hotel carpark in view of CCTV surveillance cameras to set up a false alibi. It was further submitted that it had been open to the jury to find that the appellant parked the motorcycle at a distance from the house in the expectation that he could light the fire and leave the house without detection. While the prosecution relied upon the appellant's flight from the scene as an implied admission of his guilt of arson, it does not appear that it invited the jury to find that the appellant had set up a false alibi and from such a finding to draw an inference of guilt. The trial judge's instructions on reasoning from the appellant's conduct to his consciousness of guilt of arson were confined to the circumstances of his departure from the scene after the explosion. The suggested false alibi played no part in the Court of Appeal's analysis of the capacity of the evidence to support the verdicts. It is a suggestion that does not rise higher than conjecture and may be put to one side. The Court of Appeal Morrison JA wrote the leading judgment in the Court of Appeal. The appellant's first ground in his amended notice of appeal in the Court of Appeal contended that "the jury's verdicts of guilty are unreasonable and cannot be supported having regard to the evidence". The second ground contended that an "hypothesis advanced by the appellant was not excluded, namely someone other than the appellant caused the appellant's home to explode". The second ground was a particular of the first. In the way the appeal was conducted the two became a combined ground; the basis upon which it was submitted that the verdicts could not be supported by the evidence was the inability to exclude an hypothesis advanced by the appellant4. This was the hypothesis that the "bearded" man seen running from the scene by some witnesses was a person other than the appellant 4 R v Coughlan [2019] QCA 65 at [9]. Bell Edelman ("the second man hypothesis"). Morrison JA's conclusion that it was open to the jury to exclude the reasonable possibility that there was a second man who ran from the scene may be accepted, largely for the reasons that his Honour gave in a meticulous review of the civilian witnesses' evidence. The focus on the capacity to eliminate the second man hypothesis, however, was apt to distract attention from the capacity of the evidence, viewed as a whole, to establish that the explosion was caused by a deliberate act and that the appellant was the actor. Morrison JA reviewed the appellant's description of his mental state in his interviews with Detective Weare. His Honour observed that the jury had before it a body of evidence that might have suggested that the appellant had a volatile character and that the explosion and fire were the result of "a black mood" on his part5. Ultimately, his Honour said that it was not necessary to reach a conclusion as to the impact of this part of the evidence. His Honour found that it was open to the jury to conclude that the appellant was guilty, notwithstanding the absence of an obvious financial motive. Before turning to Morrison JA's reasons for his Honour's ultimate conclusion, two related points concerning the absence of apparent financial motive and the evidence of the appellant's volatile mental state may be noted. While, as Morrison JA correctly observed, lack of motive is not fatal to the conclusion of guilt, the proven absence of apparent financial motive6 had particular significance with respect to proof of the appellant's guilt of the offence of wilfully and unlawfully setting fire to the house. The unlawfulness of setting fire to the appellant's own property lay in proof that his purpose in so doing was to make a fraudulent claim on his insurer. Had the appellant set fire to the house in anger over the argument with his wife, as Detective Weare suggested in the course of the first interview, or more generally because of his volatile mental state, as Morrison JA suggested, he would not have been guilty of the offence7. The acknowledged absence of apparent financial motive was a circumstance of some moment. Morrison JA took into account the following circumstances in addition to the expert evidence: that the appellant was the only person seen near the house that 5 R v Coughlan [2019] QCA 65 at [395]. 6 De Gruchy v The Queen (2002) 211 CLR 85 at 92-93 [28]-[30] per Gaudron, 7 Criminal Code (Qld), ss 459, 461(1)(a). Bell Edelman afternoon; Patruno's and Dyke's evidence of smelling petrol shortly before the explosion; that while some of the youths who were outside the house had criminal records, it was open to the jury to exclude them from involvement in the explosion; and that, even allowing for the fact that the appellant might have been in a state of shock after the explosion occurred, it was open to the jury to be sceptical of the appellant's account that he continued to believe that he was being pursued all the way to the Bruce Highway. Morrison JA's analysis of the sufficiency of the evidence to support the verdicts was dependent upon inferences drawn from the expert evidence. The analysis should be set out in full: "[389] The jury were confronted with a dilemma which they had to resolve in terms of the assessment of the evidence overall. On the one hand they had the interviews with the appellant, in which he steadfastly denied any involvement and said that he was never in the house on that afternoon. And there was no obvious financial motive to carry out the arson. [390] On the other hand, the expert evidence established that the explosion was as a result of vapour, it originated inside the house, and at some point the appellant's tracksuit pants and shoes came into contact with liquid petrol. That contact with petrol could not have been as a result of the casual activities of filling a car at a service station or mowing the lawn or storing the clothes in a shed. Because the appellant did not give evidence, there was no basis upon which the jury could have concluded that any such thing was possible. [391] Therefore, as against the appellant's denials of involvement, and as well the lack of obvious motive, there was very powerful evidence from the scientific experts that the appellant's shoes and tracksuit pants had been in contact with liquid petrol within hours before the items were tested. What, then, is the explanation for the appellant's having come into contact with liquid petrol on his tracksuit pants and shoes on the afternoon that his house burned down as a result of a vapour explosion. In my view, the obvious response is that the appellant was involved in distributing petrol which led to that explosion. [392] Further, the mere fact that the appellant's shoes and tracksuit pants were in contact with liquid petrol that afternoon was a powerful piece of evidence compelling rejection of the appellant's version that he was not in the house at any time that afternoon. On the appellant's account given in the interviews there was no occasion that day when his shoes or tracksuit pants Bell Edelman could have come into contact with liquid petrol. The two versions are simply irreconcilable, but there was compelling support for the presence of the petrol from Maxwell." (emphasis added) No expert evidence was led to suggest that the fairly superficial burns to the appellant's face, and the burns to his lower back and left hand, were consistent with him having been inside the house at the time of the explosion. Given the force of the explosion and the intensity of the heat generated by the fire, the respondent fairly acknowledged that "perhaps common sense might dictate otherwise". The respondent noted that Morrison JA's analysis was posited on the appellant having distributed petrol inside the house that afternoon but not on him having been inside the house when the vapours were ignited. Where the appellant was at that time, and the means by which the vapours were ignited, in the respondent's submission, "remains, to some extent, a mystery". The essential steps in his Honour's analysis were the findings that: (i) the appellant's tracksuit pants and shoes had been in contact with liquid petrol; (ii) that contact was within hours before they were tested; and (iii) the contact could not have been the result of casual activities. In each respect, the findings overstated Ms Maxwell's evidence. As to (i), testing by gas chromatography mass spectroscopy established that the tracksuit pants and the shoes contained petrol residues. While at one point in cross-examination Ms Maxwell said this result made it highly likely that these items had come into contact with liquid petrol, she returned in re-examination to the opinion she had expressed in her evidence-in- chief, namely, that it was probable that they had come in contact with liquid petrol. As to (ii), the finding that the tracksuit pants and the shoes had been in contact with liquid petrol within hours before being tested appears to have been based on Ms Maxwell's evidence of tests carried out by a colleague8. The results of this unpublished study did not, however, cause Ms Maxwell to depart from her evidence, which was that "I can't offer any opinion on the age of the contact. I can only tell you that the petrol residues were found." As to (iii), Morrison JA rejected the reasonable possibility that the petrol residues detected on the appellant's tracksuit pants and shoes could have come from casual activities, such as filling a car at a service station, mowing the lawn, or storing the clothes in a shed, because the appellant did not give evidence of such an event. The evidence did not exclude the possibility that petrol residues may be found on clothing as the result of casual activities. In the published study to which 8 R v Coughlan [2019] QCA 65 at [391] fn 579. Bell Edelman Ms Maxwell referred, traces of petrol were found on the shoes of two, and components of petrol were found on the clothing of one, of the 17 persons who had filled a mower with petrol. The possibility of an explanation for the presence of an unknown quantity of petrol residues on the appellant's clothing as the result of some casual contact was to be taken into account in weighing all of the circumstances. That is so notwithstanding that the appellant did not describe any casual contact with petrol, albeit that in detailing his activities on the morning of the day of the explosion, he said that he had cleaned up leaves at his Narangba home with a petrol-powered leaf blower. The respondent's case in this Court The Court of Appeal's conclusion that the appellant distributed petrol inside the house was expressed to be based upon the expert evidence alone. In material respects the effect of that evidence was overstated. Ms Maxwell's evidence was not capable of supporting the finding that the appellant was inside the house distributing petrol on the afternoon of the explosion. The respondent submitted that, regardless of any overstatement of the effect of Ms Maxwell's evidence, the Court of Appeal was right to find that upon the whole of the evidence it was open to the jury to be satisfied beyond reasonable doubt that the appellant distributed petrol inside the house and that he ignited the petrol vapours9. Patruno's and Dyke's evidence that they smelt petrol prior to the explosion, taken with the presence of petrol residues on the appellant's tracksuit pants and shoes, sustained the inference beyond reasonable doubt that the explosion was of petrol vapours. The appellant's presence at the scene and flight from the house, taken with the presence of the petrol residues on his clothing, supported the further inference that he distributed the petrol and caused its ignition. It was open to the jury, in the respondent's submission, to reject the appellant's account of his reason for being at the house that afternoon, and for fleeing from the scene, as implausible. The fire the result of direct human involvement? In written submissions, the respondent contended that there was no challenge to the expert evidence that the fire was "the result of direct human involvement". This was a reference to Mr Spencer's opinion: 9 M v The Queen (1994) 181 CLR 487 at 493 per Mason CJ, Deane, Dawson and Bell Edelman "Q. ... did you form an opinion as to whether the cause of the fire was as a result of human involvement? A. I did. I formed an opinion, yes. Q. Okay. And what was your opinion in relation to that? A. My opinion was it was direct human involvement and the cause was incendiary. Q. And what does that mean? A. Incendiary means a fire that has been lit by a person or persons unknowing – knowing that it should not be lit." This evidence was admitted without objection, notwithstanding that Mr Spencer did not explain the basis upon which the conclusion of direct human involvement rested. It is a conclusion that is difficult to reconcile with Mr Spencer's acceptance that he could not "rule out the cause of the fire as [being] an electrical fire". It is not correct to say that Mr Spencer's opinion as to direct human involvement was unchallenged. In cross-examination, the appellant put to Mr Spencer, and he accepted, that he had previously acknowledged that Sergeant Gormon's "information was at a higher standard [than his] because of her science training". Mr Spencer added that this opinion also took into account Sergeant Gormon's role within the Queensland Police Service. The appellant then sought to obtain Mr Spencer's acceptance of Sergeant Gormon's opinion that: "The ignition source was unable to be determined. The first fuel ignited was unable to be determined. The cause of the fire was undetermined." While much of the appellant's focus at the trial was directed to the possibility that the explosion was the work of some malefactor who was trying to kill him, the defence case was left as one in which there was no direct evidence that the fire was deliberately started by anyone. The trial judge reminded the jury in this respect that Sergeant Gormon and Mr Spencer could not positively determine the cause of the fire. In summarising Mr Spencer's evidence, her Honour also reminded the jury that he could not rule out an electrical fire. Bell Edelman The ground of appeal in this Court The appellant's ground of appeal in this Court contends that the Court of Appeal misapplied the principles in M v The Queen10 in that their Honours merely identified a pathway to a verdict of guilty rather than weighing those matters which militated against guilt to determine whether the jury ought to have entertained a reasonable doubt. Morrison JA set out the principles governing the determination of an appeal on the ground that the conviction is unreasonable or cannot be supported having regard to the evidence by reference to M v The Queen and the authorities that have followed it11. The appellant's criticism of the application of those principles appears to reflect his choice below to focus on the second ground of appeal: the inability to exclude the second man hypothesis. The second man hypothesis assumed, consistently with the appellant's stated belief, that the explosion was the result of the deliberate act of a human actor. It remains that the issue raised by the appellant's first ground in the Court of Appeal required consideration of whether it was open to the jury to be satisfied beyond reasonable doubt that the explosion was caused by the distribution of petrol inside the house in circumstances in which: (i) there was no evidence of the presence of any petrol residues in the house; (ii) the evidence did not exclude that gas was connected to the house; and (iii) the evidence did not exclude the possibility of an electrical fire igniting whatever gaseous vapours had built up inside the house. Acknowledgment that the jury had the benefit of seeing and hearing Patruno's and Dyke's evidence did not relieve the appellate court of assessing the capacity of their evidence, taken with the other circumstances on which the prosecution relied, to establish that the explosion was of petrol vapours12. Patruno's statement, in which he recalled a strong smell of petrol before the explosion, was made two years and four months later. There was no evidence that Patruno told the (1994) 181 CLR 487 at 493 per Mason CJ, Deane, Dawson and Toohey JJ. 11 R v Coughlan [2019] QCA 65 at [291]-[294], citing M v The Queen (1994) 181 CLR 487 at 493-494 per Mason CJ, Deane, Dawson and Toohey JJ, SKA v The Queen (2011) 243 CLR 400 at 408-409 [20]-[22] per French CJ, Gummow and Kiefel JJ and R v Baden-Clay (2016) 258 CLR 308 at 329-330 [65]-[66] per French CJ, Kiefel, Bell, Keane and Gordon JJ. 12 See Fennell v The Queen (2019) 93 ALJR 1219 at 1233 [81] per Kiefel CJ, Keane, Nettle, Gordon and Edelman JJ; 373 ALR 433 at 451-452. Bell Edelman police officer whom he spoke to within a day or so of the explosion of having smelt petrol. The police did not obtain a statement from Drayton, who was with Patruno at the time. Dyke gave inconsistent accounts of the conversation with Long concerning the smell of petrol. There is also a question of the likelihood that persons seated in a vehicle parked in the street outside the house or walking to the neighbouring house would have smelt petrol inside the house. The explosion occurred because of a build-up of gaseous vapours inside the house. Were any of the windows or doors to have been open, it might have been expected that the gaseous vapours would have tended to dissipate. It may be allowed that aspects of the appellant's account of the planned meeting with the prospective purchaser of the motorcycle present as implausible. Nonetheless, it remains that such features of his account, as were able to be investigated, were confirmed. Before the jury could rely on the appellant's flight from the scene in support of the prosecution case, it had to be satisfied that, in all the circumstances, there was no explanation of that conduct other than his consciousness of his guilt of arson. As Morrison JA acknowledged, the appellant might have been in a state of shock as the result of the explosion. His Honour allowed that, on the appellant's account of events, it was possible that he believed he was being followed. His Honour did accept that the appellant could have continued in that belief all the way to the Bruce Highway. Given the appellant's volatile mental state and admitted tendency to paranoia, it is not evident that his assertion that he feared he was being pursued after he reached the Bruce Highway was unworthy of belief. His presentation at the Caboolture Police Station was consistent with his account of being in fear for his safety. He was variously described by the officers who saw him as "highly agitated"; possibly in shock; and distressed. Constable Burgess accepted that he may have said, "[s]omeone tried to kill me. I went to ... sell a motor bike. The house blew up", or words to this effect. His attitude towards the police at the Caboolture Police Station was perceived by the shift supervisor to be "very helpful". An assessment of the sufficiency of the evidence to support the verdict of guilt in a circumstantial case such as this one requires the appellate court to weigh all the circumstances in deciding whether it was open to the jury to draw the ultimate inference that guilt has been proved to the criminal standard13. That 13 Shepherd v The Queen (1990) 170 CLR 573 at 579 per Dawson J; R v Hillier (2007) 228 CLR 618 at 637 [46] per Gummow, Hayne and Crennan JJ; Fennell v The Queen (2019) 93 ALJR 1219 at 1233-1234 [82]; 373 ALR 433 at 452. Bell Edelman inference will not be open if the prosecution has failed to exclude an inference consistent with innocence that was reasonably open. The presence of petrol residues on the appellant's clothing, taken with Patruno's and Dyke's evidence of smelling petrol before the explosion, was not capable of supporting the inference beyond reasonable doubt that the explosion was of petrol vapours in the absence of any evidence of petrol residues in the remains of the house. The expert evidence did not exclude the reasonable possibility that the explosion was of a build-up of gas that was ignited by an electrical fire. The appellant's account of his reasons for being at the house that afternoon, and his conduct in the aftermath of the explosion, were not capable, when viewed with the other circumstances (the presence of the petrol residues on the appellant's tracksuit pants and shoes, and Patruno's and Dyke's evidence of smelling petrol), of excluding that possibility. That is all the more so when account is taken of the acknowledged absence of apparent financial motive for the appellant to set fire to the house. It was not open to the jury to be satisfied of the appellant's guilt of either offence beyond reasonable doubt. The orders that the Court of Appeal should have made were those this Court made on 12 February 2020 quashing the convictions and entering verdicts of acquittal on each count.

HIGH COURT OF AUSTRALIA MONTEVENTO HOLDINGS PTY LTD & ANOR APPELLANTS AND GIUSEPPE DIEGO SCAFFIDI & ANOR RESPONDENTS Montevento Holdings Pty Ltd v Scaffidi [2012] HCA 48 7 November 2012 ORDER Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 27 July 2011 and, in their place, order that: the appeal to that Court be dismissed; and (b) Giuseppe Scaffidi pay the costs of Eugenio Scaffidi, Maria Scaffidi and Montevento Holdings Pty Ltd, including reserved costs, to be taxed if not agreed. The first respondent pay the appellants' costs of the appeal to this Court. On appeal from the Supreme Court of Western Australia Representation K A Vernon with A S Meysner for the appellants (instructed by Butcher Paull & Calder) P E Cahill SC with C J Garde for the first respondent (instructed by Oldfield Legal) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Montevento Holdings Pty Ltd v Scaffidi Equity – Trusts and trustees – Trust deed for discretionary family trust provided that "[i]f, and so long as any individual Appointor is a Beneficiary that individual shall not be eligible to be appointed as a Trustee" – Individual who was appointor of trust was also beneficiary of trust – Whether corporation of which appointor was sole director and shareholder eligible to be appointed trustee of trust. FRENCH CJ, HAYNE, CRENNAN, BELL AND GAGELER JJ. Part of the background to this appeal is a long-running dispute between members of the Scaffidi family over the control of a trust called The Scaffidi Family Trust ("the trust"). The appeal concerns the proper construction of a clause in the trust deed governing the appointment of trustees. The second appellant, Eugenio Scaffidi, and the first respondent, Giuseppe Scaffidi, are brothers. They are the only children of Antonio Scaffidi, who died on 29 August 2004, and the second respondent, his widow Maria Scaffidi, who is party to these proceedings by her guardian ad litem, the Public Trustee. The second respondent has filed an appearance submitting to any orders made by the Court. The first appellant, Montevento Holdings Pty Ltd ("Montevento"), was incorporated on 27 March 2007. Since that date, Eugenio Scaffidi has been its sole director and shareholder. The trust was created by a deed of settlement dated 2 May 1977 ("the trust deed"). It is a discretionary trust designed to regulate the acquisition, management and disposal of assets of the Scaffidi family. Giuseppe, Eugenio and Maria Scaffidi are all within the class of beneficiaries of the trust, and Eugenio Scaffidi is the appointor of the trust. This appeal concerns the proper construction of cl 11.03 of the trust deed, which provides that "[i]f, and so long as any individual Appointor is a Beneficiary that individual shall not be eligible to be appointed as a Trustee." By a deed poll dated 18 February 2009, in his capacity as appointor, Eugenio Scaffidi appointed Montevento as the sole trustee of the trust. On 19 April 2010, Giuseppe Scaffidi commenced proceedings in the Supreme Court of Western Australia against Eugenio and Maria Scaffidi and Montevento, seeking a declaration that the appointment of Montevento as the sole trustee of the trust was invalid because it breached cl 11.03 of the trust deed, or, alternatively, an order for Montevento's removal as trustee pursuant to s 77 of the Trustees Act 1962 (WA) ("the Trustees Act"). The primary judge (EM Heenan J) dismissed Giuseppe Scaffidi's proceedings1. However, a majority of the Court of Appeal (Murphy JA and Hall J; Buss JA dissenting) upheld Giuseppe Scaffidi's appeal2. The Court of 1 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 2 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146. Hayne Crennan Bell Appeal made orders which included a declaration that the appointment of Montevento as the sole trustee of the trust was invalid because it breached cl 11.03 of the trust deed, and required the appointment of a new trustee pursuant to the Trustees Act. By special leave, Eugenio Scaffidi and Montevento appeal to this Court. Facts The trust deed provides for the offices of trustee (cll 11 and 12), appointor (cl 13), and guardian (cll 14 and 15), described below. The class of beneficiaries of the trust is broad, and is defined in cl 1.04 by reference to the "Specified Members", Giuseppe and Eugenio Scaffidi. Clause 9 of the trust deed deals with the distribution of the trust fund to beneficiaries. The trust deed does not confer on any of the beneficiaries a vested interest in the capital or income of the trust fund. Instead, the trust deed grants the trustee a discretionary power, within some prescribed limits (including a requirement of consent of the guardian), to distribute capital or income in favour of one or more of the beneficiaries. Clause 10 of the trust deed sets out the trustee's powers in relation to the trust fund. The trustee has broad powers under the trust deed to deal with the investment and realisation of the trust fund. Clause 11 of the trust deed provides for the appointment and removal of the trustee. Clause 11.01 relevantly provides that "[a] trustee may be a corporation." Many of the provisions of the trust deed3 distinguish between an "individual", meaning a natural person, and a "corporation" or "company" 4. Clauses 11.02 and 11.03 provide: Subject to the provisions of this Deed the Appointor may by instrument in writing at any time and from time to time: remove any Trustee hereof; 3 See, for example, cll 10.03.04, 11.01, 11.05, 11.06, 12.04, 12.09.03, 12.11, 12.12, 13.05 and 14.03. 4 See Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 at [85]-[91] per Buss JA. Hayne Crennan Bell appoint any additional Trustee or Trustees; appoint a new Trustee or Trustees in the place of any Trustee who resigns his Trusteeship or ceases to be a Trustee by operation of law. If, and so long as any individual Appointor is a Beneficiary that individual shall not be eligible to be appointed as a Trustee." Between 2 May 1977 and 16 August 1995, Scaffidi Nominees Pty Ltd ("Scaffidi Nominees") was the sole trustee of the trust. Scaffidi Nominees was incorporated on 27 April 1977. Giuseppe and Eugenio Scaffidi were its original directors, and Antonio and Maria Scaffidi were appointed directors on 3 May 1977. Antonio, Maria, Giuseppe and Eugenio Scaffidi all continued as directors until 10 May 2000, and there were no other directors during this time. Antonio, Maria, Giuseppe and Eugenio Scaffidi all held shares in Scaffidi Nominees. Between 16 August 1995 and 18 February 2009, Scaffidi Holdings Pty Ltd ("Scaffidi Holdings") was the sole trustee of the trust. Scaffidi Holdings was incorporated on 29 June 1995. Antonio, Maria, Giuseppe and Eugenio Scaffidi were its original directors. Antonio Scaffidi was a director until his death on 29 August 2004, and Maria Scaffidi was a director until 30 June 2006. There have been no other directors. Antonio, Maria, Giuseppe and Eugenio Scaffidi all held shares in Scaffidi Holdings. Since 18 February 2009, Montevento has been the sole trustee of the trust. Clause 13 of the trust deed provides for the appointment and removal of the appointor. The first appointor of the trust was Antonio Scaffidi. On Antonio Scaffidi's death, Maria Scaffidi became the appointor. By a deed dated 30 June 2006 made between Maria and Eugenio Scaffidi, Maria Scaffidi, in her capacity as appointor, appointed Eugenio Scaffidi to be the appointor of the trust. Clause 14 of the trust deed provides for the appointment and removal of the guardian. Some of the powers of the trustee are circumscribed by a requirement that the trustee not exercise those powers without the express written consent of the guardian of the trust5. The first guardian of the trust was Antonio Scaffidi. On Antonio Scaffidi's death, Maria Scaffidi became the guardian. By a 5 See, for example, cll 9.01, 9.02, 9.03 and 15.01. Hayne Crennan Bell deed poll dated 30 June 2006, Maria Scaffidi, in her capacity as guardian, declared pursuant to cl 15.04 of the trust deed that any or all of the powers or rights referred to in cl 15.01 may be exercised by the trustee without reference to the guardian. Whilst the phrase "discretionary trust" has no "constant, fixed normative meaning"6, it is apt to describe this trust and, in particular, the relative positions of the trustee and the beneficiaries. Relevant legislation As at 2 May 1977, provisions of the Estate Duty Assessment Act 1914 (Cth), the Stamp Duties Act 1920 (NSW), and the Death Duty Assessment Act 1973 (WA) imposed death duties on the property of a deceased person, and relevantly provided that the estate of a deceased person would be deemed to include any property over which the deceased person had a "general power of appointment" at the time of his or her death7. Prior to the commencement of the First Corporate Law Simplification Act 1995 (Cth) on 9 December 1995, proprietary companies were required to have at least two directors and at least two shareholders. The First Corporate Law Simplification Act 1995 (Cth) allowed for the creation of proprietary companies with one director and one shareholder, something which continues to be possible under the Corporations Act 2001 (Cth)8. Proceedings In dismissing Giuseppe Scaffidi's proceedings seeking a declaration that the appointment of Montevento as the sole trustee of the trust was invalid, the primary judge found that Eugenio Scaffidi was the sole director and shareholder 6 CPT Custodian Pty Ltd v Commissioner of State Revenue (Vic) (2005) 224 CLR 98 at 109-110 [15]; [2005] HCA 53, citing Chief Commissioner of Stamp Duties (NSW) v Buckle (1998) 192 CLR 226 at 234 [8]; [1998] HCA 4. 7 See Estate Duty Assessment Act 1914 (Cth), ss 8(1) and 8(3); Stamp Duties Act 1920 (NSW), ss 100, 101 and 102(2)(j); Death Duty Assessment Act 1973 (WA), ss 10(1) and 10(2)(i). 8 See Corporations Act 2001 (Cth), ss 114, 201A(1). Hayne Crennan Bell of Montevento and, hence, the sole controller of Montevento9. His Honour also acknowledged that Montevento had no apparent commercial purpose or history other than acting in the role of trustee of the trust10. However, the primary judge considered this latter point as being of "little significance"11, and found that there was no evidence that Eugenio Scaffidi had appointed Montevento as trustee for an improper purpose12. The primary judge went on to reject, in the following terms, Giuseppe Scaffidi's argument that the appointment of Montevento as the sole trustee of the trust was in breach of cl 11.03 of the trust deed13: "I am satisfied that in this case the deed of settlement draws a clear distinction between individuals and corporations, recognises that a corporation may be a trustee or co-trustee of this trust, and contains no actual or implicit prohibition upon a corporation, even if controlled by a beneficiary, from being such a trustee. Because the corporation is distinctly and legally separate from the individual, I do not consider that the prohibition in the deed of settlement against an individual beneficiary being a trustee prohibits the appointment of Montevento and, accordingly, I dismiss the application by Mr Giuseppe Scaffidi seeking declarations or other relief on the basis that Montevento was invalidly appointed." 9 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 180 10 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 180 11 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 180 12 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 180 13 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 180 Hayne Crennan Bell The primary judge found that there was no evidentiary basis for concluding that Montevento would jeopardise the welfare of the trust fund or the interests of the beneficiaries14 and observed15: "As trustee, Montevento is subject to the duties and obligations resting upon any trustee at law and in this case as also set out in the deed of settlement. There are ample avenues of redress available to any aggrieved beneficiary to challenge or review the actions of the trustee. More significantly, there is no allegation that Montevento has admitted, or is threatening or likely to commit, any breach of trust." The primary judge went on to say that he was satisfied that, as trustee, Montevento had advanced the welfare of the trust and the interests of the beneficiaries by making efforts to identify, collect and preserve the assets of the trust, including by demanding payment of a large debt owing to the trust by a company associated with Giuseppe Scaffidi16. In dissent in the Court of Appeal, Buss JA supported the reasoning of the primary judge. His Honour noted that the trust deed consistently distinguishes between individuals and corporations17. This is the critical point which is sufficient to determine this appeal. His Honour also observed that the drafters of the trust deed would have been concerned to avoid the revenue consequences of conferring a "general power of appointment" upon the trustee18. Relying on these considerations, and on the natural and ordinary meaning of the words of cl 11.0319, Buss JA held that the language of cl 11.03 does not extend to prohibit 14 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 180 15 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 180 16 Montevento Holdings Pty Ltd v Scaffidi Holdings Pty Ltd (No 2) [2010] WASC 180 17 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 at [85]-[91]. 18 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 at [96]. 19 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 at [92]-[93]. Hayne Crennan Bell the appointment of a trustee which is a corporation 20. The construction of cl 11.03 adopted by Buss JA is plainly correct. The majority in the Court of Appeal, Murphy JA and Hall J, upheld Giuseppe Scaffidi's appeal from the decision of the primary judge, on the basis that the appointment of Montevento as the sole trustee of the trust was in breach of cl 11.03 of the trust deed21. In a joint judgment, their Honours emphasised the importance of the words "appointed as a Trustee" in cl 11.0322 and said23: "The words in cl 11.03, in their ordinary usage, are capable of meaning that a beneficiary/appointor is ineligible to be appointed to a position involving the performance or the functions of a trustee under the trust deed, or involving the performance of activities proper to the institution of a trustee under the trust deed ... The contention that [a person who is both an appointor and a beneficiary] may appoint himself to the position of exercising the powers and rights of the trustee by appointing as trustee a company of which he is the sole director and shareholder involves, in our view, assigning a meaning to the word 'Trustee' which it cannot reasonably bear when cl 11.03 is read as a whole, in that it treats the office of trustee as entirely separate from the powers and rights exercisable by the officeholder." In this Court, the first respondent sought to amplify the reasoning of the majority in the Court of Appeal by pointing to the use in cl 11.03 of the phrase "appointed as a Trustee" (emphasis added). The first respondent submitted that the words "as a" were used in the clause to distinguish between control over the exercise of the trustee's powers, and appointment to the office of trustee. It followed, so the argument continued, that the class of persons excluded from appointment to the office of trustee extended to any corporate person whose powers, directions or duties as trustee would be exclusively exercised by the individual appointor. 20 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 at [93]. 21 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 at [169]. 22 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 at [161]-[164]. 23 Scaffidi v Montevento Holdings Pty Ltd [2011] WASCA 146 at [163], [165]. Hayne Crennan Bell It is enough to say that cl 11.03 does not bear the meaning which the first respondent attributed to it. The ordinary and natural meaning of the clause is that any natural person who holds the office of appointor may not be appointed as trustee. The words "as a" will not bear the weight which the first respondent sought to place upon them. Rather, when cl 11.03 is read in the context of the whole document, which repeatedly distinguishes between an "individual" (in the sense of a natural person) and a corporation, the clause must be read in the manner indicated by Buss JA. The matters of context to which Buss JA referred point in the same direction. Orders The following orders should be made: Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 27 July 2011 and, in their place, order that: the appeal to that Court be dismissed; and (b) Giuseppe Scaffidi pay the costs of Eugenio and Maria Scaffidi and Montevento, including reserved costs, to be taxed if not agreed. The first respondent pay the appellants' costs of the appeal to this Court.

HIGH COURT OF AUSTRALIA APPELLANTS AND RESPONDENT Byrnes v Kendle [2011] HCA 26 3 August 2011 ORDER Appeal allowed with costs. Orders 1 and 3 of the orders of the Full Court of the Supreme Court of South Australia sealed 20 January 2010 be set aside and in place thereof it be ordered that: the appeal to the Full Court be allowed with costs; and the orders of the District Court made on 31 March 2009 and order 1 of the orders made on 22 June 2009 be set aside and in place thereof: declare that the solicitors for the respondent, Clifford Frank Kendle, be at liberty to account for the moneys held by them in trust pursuant to order 4 of the orders of the District Court made on 11 September 2008 by paying thereout to the first appellant, Martin Francis Byrnes, or as he may direct in writing, the sum of $73,534.70 and by paying the balance to Mr Kendle, or as he may direct in writing; (ii) order that: Mr Kendle pay the costs of the appellants on a party and party basis of the trial and all applications filed in the District Court action; and the action otherwise be dismissed. On appeal from the Supreme Court of South Australia Representation D M J Bennett QC with A L Tokley for the appellants (instructed by Haarsma Lawyers) M A Frayne SC with N J Floreani for the respondent (instructed by Corsers Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Byrnes v Kendle Equity – Trusts and trustees – Express trusts constituted inter vivos – Where respondent by deed declared one half of property held "upon trust" for second appellant – Whether respondent a trustee – Whether evidence extrinsic to deed relevant to intention to create trust. Equity – Trusts and trustees – Powers, duties, rights and liabilities of trustees – Liability for breach of trust – Where trustee leased trust property – Whether duty to collect rent – Whether breach of duty to fail to collect unpaid rent – Where beneficiary knew trustee failed to collect rent and was told trustee had duty to collect rent – Whether beneficiary consented to or acquiesced in breach – Whether trustee entitled to set-off outgoings and improvements to property in taking of accounts. Words and phrases – "acquiescence", "bare trust", "consent", "estoppel", "express trust", "intention", "upon trust". Law of Property Act 1936 (SA), ss 29(1)(b), 41. Trustee Act 1936 (SA), ss 6, 7, 8, 25A, 25C. Introduction In proceedings commenced in the District Court of South Australia in September 2008, Martin Byrnes and his mother, Joan Byrnes, alleged that, between 2002 and 2007, Mrs Byrnes' estranged husband, Clifford Kendle, had committed breaches of trust in relation to a house and land at 10 Rachel Street, Murray Bridge ("Rachel Street"). The legal title to the property was held by Mr Kendle. However, he had signed an Acknowledgment of Trust in 1997 declaring that he held one undivided half interest in the property as tenant in common upon trust for Mrs Byrnes. The principal breach of trust alleged against Mr Kendle was that he let the house to his son in 2002 for a weekly rental of $125, collected only $250 rent from him and took no steps to collect any further rent over the ensuing years of his son's occupancy, which was terminated in 2007. Martin Byrnes' involvement in the proceedings stems from his mother's assignment to him of her interest in Rachel Street and her rights arising out of the Acknowledgement of Trust. That assignment was effected by deed in March 2007. The property was sold three days after the commencement of the proceedings. On 31 March 2009, Boylan DCJ, following a trial of the action, made a declaration that Mr Kendle held one half of the net proceeds of sale of Rachel Street on trust for Mr Byrnes1. The claims based on breaches of trust, including the alleged failure to collect rent, were dismissed. In a separate judgment given on 22 June 2009, the primary judge ordered that Mr Byrnes and his mother pay Mr Kendle's costs of the trial and all applications filed in the action. His Honour refused an application by Mr Kendle for indemnity costs. On 18 December 2009, the Full Court of the Supreme Court of South Australia (Doyle CJ, Nyland and Vanstone JJ)2 dismissed the appeal and a cross-appeal on the costs decision and ordered that Mr Byrnes and his mother pay Mr Kendle's costs of the appeal. An application to the Full Court to reopen the hearing of the appeal to permit further submissions, in relation to a loan made by Mr Kendle to his son on the security of the property, was refused. On 3 September 2010, Mr Byrnes and his mother were granted special leave to appeal (French CJ, Crennan and Bell JJ) against the first decision of the Full Court. The second decision of the Full Court, refusing the application to reopen the hearing of the appeal, was not the subject of a grant of special leave. 1 Byrnes v Kendle [2009] SADC 36. 2 Byrnes v Kendle (2009) 3 ASTLR 459. This case concerns a husband and wife in their 80s, now separated, who have been engaged in litigation with each other for more than two and a half years over relatively small sums of money. That they should be involved in such litigation at this time of their lives is a great misfortune for them and their families. For the reasons that follow, the appeal must be allowed. The facts of the case3 and relevant aspects of the reasoning of the primary judge and the Full Court are set out in joint judgment of Gummow and Hayne JJ. The appeal to this Court Mr Byrnes and his mother appeal to this Court on the grounds that the Full Court erred in law in finding that Mr Kendle did not have a duty with respect to the recovery of rent in relation to the property of which he was trustee. They also challenge the finding of the Full Court that Mr Kendle was not subject to the duties that would normally be imposed on a trustee who rents out trust property. They contend that the Full Court erred in law and in fact in finding that Mrs Byrnes had consented to or acquiesced in Mr Kendle's actions as trustee. By notice of contention Mr Kendle challenges the finding of the Full Court that the Acknowledgment of Trust created an express trust of which Mrs Byrnes was a beneficiary. He asserts that, even if he were a trustee, he did not have a duty to collect rent and that, if he did have such a duty, it had been waived. He also asserts that, in any event, the set off for outgoings and improvement to the premises paid solely by him, results in there being no balance due to Mrs Byrnes. Statutory framework This appeal is concerned with the application of established equitable principles. There is, however, a statutory context in which it arises. The trust said to have been established by Mr Kendle related to an undivided half share in Rachel Street. It attracted the application of s 29(1)(b) of the Law of Property Act 1936 (SA) ("the Law of Property Act"). That provision requires that a declaration of trust with respect to an interest in land be manifested or proved by some writing signed by some person able to declare such trust. The definition of "land" under the Law of Property Act, includes "an undivided share in land"4. Section 29(1)(b) does not require that the trust be created by the writing which manifests or proves it, albeit the distinction is not 3 Reasons of Gummow and Hayne JJ at [32]-[39]. 4 Law of Property Act, s 7. material in this case5. In his defence, filed in the District Court, Mr Kendle contended that the Acknowledgment of Trust did not comply with the Law of Property Act, although his pleading did not specify how it was non-compliant. Non-compliance with the Law of Property Act was not asserted in this appeal. Nevertheless, the Byrnes submitted, and it may be accepted, that the Acknowledgment of Trust complied with the requirements of s 41 of the Law of Property Act and that it was a deed6. That formality serves to emphasise the status of the Acknowledgement of Trust as an exhaustive manifestation of Mr Kendle's intention to create a trust. The question whether it was appropriate for the primary judge to go behind that Acknowledgement of Trust to inquire into Mr Kendle's "real intention" is discussed later in these reasons. The legal title to Rachel Street was held by Mr Kendle as registered proprietor of the land pursuant to the provisions of the Real Property Act 1886 (SA). As senior counsel for the Byrnes accepted in oral argument, in so far as the asserted trust was in force on the face of the register, it was a personal obligation within the exceptions to the indefeasibility of registered title7. A caveat on the title, lodged by Mr Byrnes, protected his interest as assignee of his mother's beneficial interest under the Acknowledgment of Trust. The Trustee Act 1936 (SA) ("the Trustee Act") is also relevant. As was pointed out in the submissions for the Byrnes, s 6 of the Trustee Act confers power on a trustee to invest trust funds in any form of investment. When the trustee, who exercises that power, is not a person engaged in the profession, business or employment of being a trustee or investing on behalf of others, he or she has a duty, imposed by s 7 of the Trustee Act, to "exercise the care, diligence 5 Kauter v Hilton (1953) 90 CLR 86 at 98; [1953] HCA 95. 6 The relevant requirements imposed by the Law of Property Act for a deed executed by a natural person are the application of the person's signature or mark on the deed (s 41(1)(a)) and attestation by a non-party witness The Acknowledgment of Trust was also expressed to be a deed: Law of Property Act, s 41(5)(a). (s 41(2)(a)). 7 Barry v Heider (1914) 19 CLR 197 at 213 per Isaacs CJ; [1914] HCA 79; Frazer v Walker [1967] 1 AC 569 at 585; Breskvar v Wall (1971) 126 CLR 376 at 384-385 per Barwick CJ; [1971] HCA 70; Bahr v Nicolay [No 2] (1988) 164 CLR 604 at 613, 618 per Mason CJ and Dawson J, 638 per Wilson and Toohey JJ; [1988] HCA 16; Bank of South Australia v Ferguson (1998) 192 CLR 248 at 255 per Brennan CJ, Gaudron, McHugh, Gummow and Kirby JJ; [1998] HCA 12. The Real Property Act 1886 (SA), s 71(e) expressly preserves the rights of a cestui que trust against the operation of the indefeasibility provisions in ss 69 and 70 where the registered proprietor is a trustee. and skill that a prudent person of business would exercise in managing the affairs of other persons"8. It was submitted for the Byrnes, that while the statutory duty relates to investment, its existence as a presumptive duty under the statute requires a conclusion that analogous principles at general law continue to apply. That submission gained support from the express preservation under s 8 of the Trustee Act of rules and principles of law or equity that impose a duty on a trustee exercising a power of investment except so far as those rules are inconsistent with any statute or the trust instrument9. None of ss 6, 7 or 8 however, is directed to the power of a trustee to lease a house held on trust nor to the duties of the trustee in relation to such leasing. Under the general law, a trustee with power to manage trust property has power to lease it for a short term10. Section 25C of the Trustee Act supplements the general law by conferring a power on a trustee of land in possession to make a lease of the land for five to ten years depending upon whether the trustee does or does not have power to manage the land. The section does not apply to a bare trustee where the beneficiary is entitled in possession and free of any incapacity11. Section 25C was not referred to in argument. The Byrnes relied upon the general law. It is at least arguable, however, that Mr Kendle also had a statutory power as trustee to lease the property. In the context of the defence of set off, s 25A of the Trustee Act authorises a trustee in his or her discretion to pay and satisfy all rates, taxes, charges, assessments or impositions assessed or imposed on or in respect of the trust property or any part thereof and to debit the moneys so paid to capital or income or adjust the same between capital and income in such manner as to the trustee shall seem equitable12. The section was not referred to in argument. The existence of a trust Mr Kendle sought, by notice of contention, to resurrect the trial judge's finding that he was not a trustee because he lacked intention to create a trust. He relied upon Commissioner of Stamp Duties (Q) v Jolliffe13. The Full Court found, 8 Trustee Act, s 7(1)(b). 9 Trustee Act, s 8(1). 10 Jacobs' Law of Trusts in Australia, 7th ed (2006) at [2020]; Attorney-General v Owen (1805) 10 Ves Jun 555 [32 ER 960]; Earl of Egmont v Smith (1877) 6 Ch D 469; Re Shaw's Trusts (1871) LR 12 Eq 124; Re Byrne (1902) 19 WN (NSW) 141. 11 Trustee Act, s 25C(5). 12 Trustee Act, s 25A(1)(b) and (d). 13 (1920) 28 CLR 178; [1920] HCA 45. adversely to that contention, that the terms of the Acknowledgment of Trust were clear. They constituted Mr Kendle a trustee, for Mrs Byrnes, of an interest as tenant in common with a life interest in his interest if he predeceased her14. The Full Court was correct in that conclusion. Jolliffe turned upon findings of fact by a trial judge made in a particular statutory context. In that case, the Queensland Government Savings Bank Act 1916 (Q) ("the Queensland statute") provided that no person should have more than one account in the Queensland Savings Bank, but that the section would not prevent any person from having additional accounts in his own name in trust for other persons15. Mr Jolliffe deposited funds into a savings account in his wife's name and his own name with the designation "Trustee". He also signed a statutory declaration in a form required by regulations made under the Queensland statute, that he was "desirous of becoming a depositor in the Queensland Government Savings Bank as the bona fide trustee of Mrs Hanna Jolliffe"16. Lukin J found, despite the documentary material, that Mr Jolliffe did not intend to make a gift to his wife. On the basis of that finding he allowed an appeal against an assessment of the Commissioner of Stamp Duties against Mr Jolliffe as administrator of his wife's estate for duty including in the assessment the money which had been deposited by Mr Jolliffe in the account. A grant of special leave to appeal to this Court, against that decision, was made subject to the condition that the appeal be limited to the question whether the effect of the Queensland statute and the documents in evidence prevented Mr Jolliffe from averring that he was not the trustee of the funds deposited. As acknowledged in each of the judgments in that case, the Court was bound to assume, for the purposes of the appeal, that it was not Mr Jolliffe's real intention to make a gift to his wife and that the money was placed in the account solely to procure interest which would not be available to him if the money had been placed there in his own name17. The findings of fact by the primary judge as to Mr Jolliffe's real intention, the correctness of which could not be challenged, were held by Knox CJ and Gavan Duffy J to be an "insuperable obstacle" to the proposition that he had created a trust. Their Honours18 relied upon a passage from the 11th edition of Lewin on Trusts: 14 (2009) 3 ASTLR 459 at 464 [28]. 15 Queensland statute, s 12 of the Schedule. 16 (1920) 28 CLR 178 at 184-185 per Isaacs J. 17 (1920) 28 CLR 178 at 181 per Knox CJ and Gavan Duffy J, 182 per Isaacs J. 18 (1920) 28 CLR 178 at 181. "It is obviously essential to the creation of a trust, that there should be the intention of creating a trust, and therefore if upon a consideration of all the circumstances the Court is of opinion that the settlor did not mean to create a trust, the Court will not impute a trust when none in fact was contemplated." (emphasis in original) Jolliffe was a case which concerned what the authors of the 18th edition of Lewin on Trusts describe as a "shamming intent"19. Neither the passage quoted from the 11th edition of Lewin nor the judgment of the majority in Jolliffe was directed to the effect of an unambiguous and explicit written declaration of a trust, in proceedings in which there is no concession or assumption about the settlor's "real intention". The passage from Lewin quoted in Jolliffe included a reference in the text, which was not quoted, to the decision of Field v Lonsdale20. That decision concerned a depositor who, without telling his sister, placed money in a bank account as trustee for her in order to evade the rules of the bank21. Given its statutory and factual setting, Jolliffe should not be taken as authority for the general proposition that where there has been an explicit written declaration of trust, unaffected by vitiating factors22, evidence is admissible to contradict the intention to create a trust manifested by the declaration. Isaacs J, who dissented in the result in Jolliffe, observed23: "An open declaration of trust is … an expression of intention that is final and beyond recall." He added24: "I cannot believe that, for instance, a solemn deed of trust or a will can be open to the reception of parol evidence, not of mistake as to its nature, or 19 Lewin on Trusts, 18th ed (2008) at 95 [4-23]. 20 (1850) 13 Beav 78; [51 ER 30]. 21 Similar facts existed in Gaskell v Gaskell (1828) 2 Y & J 502 [148 ER 1017], footnoted in the passage from Lewin. The settlor's purpose was to avoid estate duty and the creation of the trust was not communicated to the appointed trustee. 22 Such as fraud, undue influence, duress, the non est factum principle or an intention to create a sham trust. 23 (1920) 28 CLR 178 at 187. 24 (1920) 28 CLR 178 at 191. as to any condition of execution, or as to undue influence or other well understood causes of ineffectiveness, but merely of personal secret intention not to do what the document purports to effect." What Isaacs J said in Jolliffe was entirely consistent with the principle that a trust cannot be created unless the person creating it intends to do so25. That principle was reiterated in Kauter v Hilton26, which was concerned with provisions of the Commonwealth Bank Act 1945 (Cth) relating to the creation of trust accounts in the Savings Bank. The Court said of Jolliffe that its effect was27: "that the mere opening of an account under the section by one person in trust for another is not necessarily sufficient to make that person a trustee for the other person. All the relevant circumstances must be examined in order to determine whether the depositor really intended to create a trust." In Associated Alloys Pty Ltd v ACN 001 452 106 Pty Ltd (in liq)28 the plurality, after referring to the treatment of Jolliffe in Kauter v Hilton, appeared to place Jolliffe in the category of cases in which the language employed by the parties for the transaction is inexplicit leaving the court to infer the relevant intention from other language used by them, from the nature of the transaction and from the circumstances attending their relationship29. The passage quoted in Jolliffe from the 11th edition of Lewin on Trusts was reproduced in the 12th to 16th editions of that work, but not in the 17th or 18th editions. In the 18th edition of Lewin on Trusts, published in 2008, Jolliffe is treated as a case about a sham trust in which the settlor was allowed to assert his own shamming intent to defeat the effect of his declaration of trust as against the revenue authority. The authors refer to the "powerful dissent" of Isaacs J and observe that30: 25 Garrett v L'Estrange (1911) 13 CLR 430 at 434 per Griffith CJ, Barton and O'Connor JJ agreeing at 435; [1911] HCA 67. 26 (1953) 90 CLR 86 at 98. 27 (1953) 90 CLR 86 at 100. 28 (2000) 202 CLR 588; [2000] HCA 25. 29 (2000) 202 CLR 588 at 605 [34] per Gaudron, McHugh, Gummow and Hayne JJ. 30 Lewin on Trusts, 18th ed (2008) at 95-96 [4-23]. "A settlor who has executed a declaration of trust is subject to the usual rule that prevents a party to a legal document from relying on mere mental reservations to resist its enforcement." A short statement of the position in a case such as the present, written in the context of the trust of the family home, appears in The Law of Trusts by Thomas "In circumstances in which there has been an express trust declared over land, the terms of that trust will be decisive of the parties' equitable interests in land, in the absence of any fraud, undue influence, or duress." (footnote omitted) The relevant intention in such a case is that manifested by the declaration of trust. Such a case does not require any further inquiry into the subjective or "real" intention of the settlor. I also respectfully agree with and adopt the reasons of Gummow and Hayne JJ on this question32. The primary judge in the present proceedings appears to have taken the view that Mr Kendle's intention could be determined by reference to evidence contradicting the Acknowledgement of Trust. He said33: "In determining whether or not an express trust has been created the court may look at evidence outside the Trust Deed to determine the intention of the alleged settlor." His Honour relied upon the decision of Perry J in B & M Property Enterprises Pty Ltd (in liq) v Pettingill34, which in turn relied upon the decision of Napier J in Starr v Starr35 applying Jolliffe as though it were authority for the proposition that "notwithstanding the terms of the written instrument said to constitute a trust, evidence was admissible to show that the document was never intended to operate as a binding declaration of trust."36 That proposition, to the extent that it 31 2nd ed (2010) at 1495 [58.04]. 32 Reasons of Gummow and Hayne JJ at [46]-[66]. 33 [2009] SADC 36 at [33]. 34 [2001] SASC 75. 35 [1935] SASR 263. 36 B & M Property Enterprises Pty Ltd (in liq) v Pettingill [2001] SASC 75 at [125]; see also Starr v Starr [1935] SASR 263 at 266-267. encompassed the case of an unambiguous written declaration of trust, was expressed too broadly. In the Full Court, Doyle CJ said37: "The terms of the Acknowledgement are clear. So are the terms of the earlier Acknowledgement. Mr Kendle might not have fully understood what he was doing, but that is neither here nor there." His Honour was correct in so holding. Mr Kendle's challenge to the finding that he had created a trust cannot succeed. Mr Kendle's duties as trustee In the Full Court, the Chief Justice proceeded upon the factual premise that Mr Kendle and the Byrnes had agreed that he would let Rachel Street to his son. His Honour held that there was "no affirmative duty on Mr Kendle to let out the property"38. In also holding that Mr Kendle had no duty to collect the rent on Rachel Street from his son, the Chief Justice took as his guide "the legal relationship as between co-owners and tenants in common"39. In so doing, with respect, he erred. His Honour said that if Mr Kendle had let the property to a tenant on an ordinary commercial basis he would have had no liability to make up unpaid rent. That may be so, as far as it goes, but that says nothing about whether he had a duty in such a case to endeavour to enforce payment or evict the non- complying tenant. Mr Kendle submitted that, as trustee under the Acknowledgement of Trust, he had "no active duties to perform". He characterised himself as a "bare trustee", described in Jacobs' Law of Trusts, which he cited, as40: "a trustee who has no interest in the trust assets other than that existing by reason of the office of trustee and the holding of the legal title, and who never has had active duties to perform or who has ceased to have those duties with the result that in either case the property awaits transfer to the beneficiaries or at their direction." 37 (2009) 3 ASTLR 459 at 464 [28]. 38 (2009) 3 ASTLR 459 at 466 [38]. 39 (2009) 3 ASTLR 459 at 466 [37]. 40 Jacobs' Law of Trusts in Australia, 7th ed (2006) at 48 [315]. Mr Kendle's characterisation begged the question whether he had a duty to collect rent from his son. The designation "bare trustee" has attracted slightly varying definitions and sometimes, as pointed out in Jacobs' Law of Trusts, takes its meaning from a statutory setting41. In the 18th edition of Lewin on Trusts the learned authors observe42: "A bare trustee, holding property for a single beneficiary who is absolutely and indefeasibly entitled, has traditionally been said to be a mere passive repository, owing a duty only to transfer the property to the beneficiary or at his direction. But it is clear that certain trustees holding property in that way owe active duties to manage the trust property, with corresponding powers, notably a trustee of land, a trustee for a minor solely entitled and a trustee with an unsatisfied right of indemnity; and other such trustees also may have powers of management with an associated duty of care." (footnotes omitted) It is also said in Lewin that when the property in question is land, "[a] trustee holding land on trust for an absolute beneficiary is not a mere cypher and has the powers of a beneficial owner in relation to the land"43. In any event, the nature of the trust in this case does not lend itself easily to characterisation as a bare trust. The co-existence of beneficial interests, one held by the trustee in his own right and the other by Mrs Byrnes as beneficiary under the trust, are consistent with the necessity for, and existence of, a power on Mr Kendle's part to manage the property and to let it when he and Mrs Byrnes vacated it. That power was associated with a duty, existing at general law, to manage the property in spite of the absence of any specific direction to that effect in the Acknowledgement of Trust44. Absent such a duty, Mrs Byrnes would have derived no benefit from the interest conferred upon her under the trust. Only Mr Kendle, with legal title to the house and land, had the power to grant a lease of the property to another and thus derive income for Mrs Byrnes' benefit as beneficial owner of an undivided half share, as well as for his own benefit as 41 Jacobs' Law of Trusts in Australia, 7th ed (2006) at 48 [315] and fn 42. 42 Lewin on Trusts, 18th ed (2008) at 1215 [34-03]. 43 Lewin on Trusts, 18th ed (2008) at 18 [1-25]; Ingram v Internal Revenue Commissioners [2000] 1 AC 293 at 305 per Lord Hoffmann, approving Millett LJ in Ingram v Internal Revenue Commissioners [1997] 4 All ER 395 at 424. See also CGU Insurance Ltd v One Tel (in liq) (2010) 84 ALJR 576 at 581 [36]; (2010) 268 ALR 439 at 446; [2010] HCA 26. 44 Adamson v Reid (1880) 6 VLR (E) 164 at 167 per Molesworth J – a case concerning the general law obligation on a trustee to invest. beneficial owner of the other undivided half share. Unlike the lands the subject of the trust considered in Earl of Egmont v Smith45, Rachel Street was not a farm "situate, perhaps in one of the finest counties in England, and readily lettable"46. Nevertheless, there was nothing to suggest that it was not lettable. Mr Kendle exercised his power and, for present purposes, may be assumed to have discharged his duty to let the property, by letting it to his son. He had, however, as trustee a continuing duty to ensure, so far as he reasonably could, that the rent was paid and if it were not paid that a new tenant was found to replace his son. Mr Kendle's duty was not to be assessed by reference to notions of a putative co-ownership. It was a fiduciary duty which he assumed when he declared the trust and retained the legal title to the land. The Full Court erred in holding that his failure to ensure that the rent was paid by his son did not give rise to a breach of duty making him liable to compensate Mrs Byrnes in respect of her interest in the unpaid rent47. Consent and acquiescence For the sake of matrimonial harmony, Mrs Byrnes did not press Mr Kendle to insist upon payment of the rent owed by his son. In his defence in the District Court proceedings, Mr Kendle raised pleas of waiver, consent and acquiescence. He also asserted an estoppel. The primary judge found that, "although unwillingly", Mrs Byrnes "consented to her husband's decisions not to press for rent"48. The Chief Justice characterised the primary judge's finding as one of co-operation by Mrs Byrnes in the breach of duty49 or concurrence or acquiescence by her in letting the matter of the rent drift. The Chief Justice held that the words "acquiescence" and "concurred" better described Mrs Byrnes' conduct than "cooperate". His Honour held that "on the judge's finding, although there was some reluctance on her part she was well aware of the issue and acquiesced in the decision not to press for rent"50. His Honour agreed with the primary judge's conclusion. 45 (1877) 6 Ch D 469. 46 (1877) 6 Ch D 469 at 476 per Jessel MR. 47 (2009) 3 ASTLR 459 at 467 [45]. 48 [2009] SADC 36 at [42]. 49 (2009) 3 ASTLR 459 at 467 [46]. 50 (2009) 3 ASTLR 459 at 467 [49]. As counsel for the Byrnes submitted, it was not clear that the Chief Justice drew any distinction between concurrence and acquiescence. The two concepts are not congruent. Consent, of course, may be expressed in a number of ways some of which may overlap with conduct constituting acquiescence. As Handley JA said in Spellson v George51: "Consent may take various forms. include active encouragement or inducement, participation with or without direct financial benefit, and express consent. Consent may also be inferred from silence and lack of activity with knowledge. However consent means something more than a state of mind. The trustee must know of the consent prior to the breach." These Handley JA quoted a number of authorities for the proposition that consent to a breach of trust operates as an estoppel and observed52: "If this defence does operate by way of estoppel it would require proof of inducement and reliance thereon by the trustee." Young AJA, in the same case, distinguished between concurrence in a breach and acquiescence after breach. His Honour also referred to the distinctions to be drawn between consent and other concepts, including the distinction between consent and "a situation where a person knows of the facts, hopes that the proposed course will take place but does nothing to assist it"53. Hope AJA, who agreed with Young AJA, said it was necessary, in determining whether a defence of consent to a breach of trust was made out, to consider all the circumstances with a view to determining whether it was fair and equitable to allow the plaintiff to sue the defendants for the breaches of trust54. In this case, neither the findings of fact by the primary judge nor the evidence supported a defence of consent. Mrs Byrnes' unwillingness to insist upon collection of the rent did not amount to a consent to Mr Kendle's inaction. Nor was there any finding that Mr Kendle, in failing to enforce collection of the rent, was induced by, or relied upon, Mrs Byrnes' position. That leaves for consideration the matter of acquiescence. 51 (1992) 26 NSWLR 666 at 669-670. 52 (1992) 26 NSWLR 666 at 670. 53 (1992) 26 NSWLR 666 at 682. 54 (1992) 26 NSWLR 666 at 674-675. Acquiescence as a defence to a claim for equitable relief is used in at least two different senses55: A person who is aware that an act is about to be done to his or her prejudice takes no step to object to it. A person being aware of a violation his or her rights which has occurred fails to take timely proceedings to obtain equitable relief. This is acquiescence after the event which founds the defence of laches. There was no plea of laches in this case. The species of acquiescence relied upon to defeat Mrs Byrnes' claim, while extended over time, was analogous to the first category. Counsel for the Byrnes pointed to a number of aspects of the evidence of Mr Kendle and Mrs Byrnes which were inconsistent with these defences: Mr Kendle's evidence in examination-in-chief and in cross-examination that he and Mrs Byrnes discussed the non-payment of rent from time to time and that both hoped that his son would pay the rent. The absence in Mr Kendle's evidence of any suggestion that his inaction was attributable to or induced by anything Mrs Byrnes did or failed to do. Mr Kendle's evidence that he decided matters concerning his family and that Mrs Byrnes decided matters concerning her family. Mrs Byrnes' evidence that, for the sake of matrimonial harmony, she did not take action to insist upon Mr Kendle pursuing his son for rent. "Mrs Byrnes and Mr Kendle were both upset at Kym's failure to pay rent. So was Martin Byrnes. On occasions the three of them discussed the problem but Mr Kendle took no action. To use his own words, he 'just let the problem drift'. Nor did Mrs Byrnes take action. She chose not to do so for the sake of matrimonial harmony." 55 Meagher, Heydon and Leeming, Equity, Doctrines and Remedies, 4th ed (2002) at 56 [2009] SADC 36 at [20]. Neither that finding nor the evidence is consistent with the concept of acquiescence on Mrs Byrnes' part in Mr Kendle's failure to discharge his duty as trustee of her interest in the house and land. She could not take action herself to recover the rent57. Mrs Byrnes' inaction, if it can be called that, is to be understood by reference to the matrimonial relationship and the fact that a member of Mr Kendle's family was at the centre of his ongoing failure to insist on the rental payment. There was no acquiescence in the relevant sense, there was no evidence of reliance by Mr Kendle upon Mrs Byrnes' inaction. In any event, given the circumstances, it could not be said that it was not fair and equitable for Mrs Byrnes to be permitted to complain of a breach of trust by Mr Kendle. Conclusion The appeal should be allowed. I agree with the reasons of Gummow and Hayne JJ in relation to the allowable set offs which Mr Kendle can claim and with the orders that their Honours propose. 57 Schalit v Joseph Nadler Ltd [1933] 2 KB 79 at 83-84. GUMMOW AND HAYNE JJ. The second appellant (Mrs Byrnes) and the respondent (Mr Kendle) married in 1980. She was then aged 60 and he about 57. Each had adult children by previous marriages. The first appellant (Mr Martin Byrnes) is the son of Mrs Byrnes and Mr Kym Kendle is the son of Mr Kendle. Mr Martin Byrnes is a solicitor and his mother took advice from him. Mrs Byrnes and Mr Kendle separated early in 2007 after some 26 years of marriage. They have not divorced and there has been no settlement of property under the Family Law Act 1975 (Cth). In 1984 Mr Kendle purchased a home unit at Brighton in South Australia being the property comprised and described in Certificate of Title Register Book Vol 4063 Folio 848, with finance provided under the scheme established by the Defence Service Homes Act 1918 (Cth)58. Mr Kendle became the sole registered proprietor. In 1989, at the instigation of Mr Martin Byrnes, Mrs Byrnes and Mr Kendle executed an instrument with respect to the Brighton property ("the 1989 Deed"). The operative provisions were as follows: Subject to clause 2, [Mr Kendle] stands possessed of and holds one undivided half interest in the Property as tenant in common upon trust for [Mrs Byrnes] absolutely ('the [Byrnes] Interest'). If [Mrs Byrnes] shall predecease [Mr Kendle], then during his lifetime and while he continues to own the remaining undivided half share in the Property as tenant in common ('the [Kendle] Interest') [Mr Kendle] shall be entitled to the use and enjoyment of the [Byrnes] Interest. This clause shall entitle [Mr Kendle] to a life interest in the [Byrnes] Interest subject to early termination upon disposal of the [Kendle] Interest. If [Mr Kendle] shall predecease [Mrs Byrnes], then during her lifetime and while she continues to own the [Byrnes] Interest [Mrs Byrnes] shall be entitled to the use and enjoyment of the [Kendle] Interest. This clause shall entitle [Mrs Byrnes] to a life interest in the [Kendle] Interest subject to early termination upon disposal of the [Byrnes] Interest." This instrument was so framed and executed as to be a deed pursuant to s 41 of the Law of Property Act 1936 (SA) ("the Law of Property Act"). Section 41(2) required attestation by at least one witness who was not a party, sub-s (3) provided that delivery was not necessary, and sub-s (5)(b) provided that an 58 See Nelson v Nelson (1995) 184 CLR 538 at 568-570; [1995] HCA 25. instrument so signed by an individual and attested was a deed if, as was the case here, the instrument was expressed to be sealed. The Brighton property was sold and the proceeds applied in the purchase in 1994 of a house in Rachel Street, Murray Bridge in South Australia. The purchase price was $47,500. Again, Mr Kendle became the sole registered proprietor. The Defence Service Homes mortgage scheme was "transferred" to Rachel Street and Westpac Banking Corporation ("Westpac") appeared on the title as mortgagee. In 1997, again at the instigation of Mr Martin Byrnes, Mrs Byrnes and Mr Kendle executed a deed ("the 1997 Deed"). They were identified therein as residing at Rachel Street and the recitals were as follows: "A. By [the 1989 Deed], the parties acknowledged that each of them was entitled to a half interest as tenant in common of the property known as Unit 19, Strata Plan 2527, 120 The Esplanade, Brighton, South Australia ('the Original Property'), and that [Mr Kendle], who was the registered proprietor of the Original Property, stood possessed of an undivided half interest in the Original Property upon trust for [Mrs Byrnes] absolutely. The Original Property was sold in 1994 and the proceeds applied to the purchase or further development of the property situated at 10 Rachel Street, Murray Bridge, South Australia ('the New Property'), of which [Mr Kendle] is now the sole registered proprietor. In addition to the proceeds from the Original Property, the Parties have both contributed other monies to the purchase or further refurbishment of the New Property. The Parties by this deed acknowledge that their respective entitlements to interests in the Original Property are transposed into interests in the New Property." Clause 1 stated that Mr Kendle "stands possessed of and holds one undivided half interest in the New Property as tenant in common upon trust for [Mrs Byrnes] absolutely". Clauses 2 and 3 of the 1997 Deed adopted clauses 2 and 3 of the 1989 Deed. However, in about December 2001, Mrs Byrnes and Mr Kendle moved out of Rachel Street and into a property in Graetz Street, Murray Bridge which had been purchased by Mr Martin Byrnes. Thereafter, the Rachel Street property, the subject of the 1997 Deed, was let by Mr Kendle to his son Kym. He lived there until early 2007, and paid rent only for the first two weeks, whereas it is now accepted that in total he should have paid $36,150. Mr Kendle's daughter Cathy persuaded her father in January 2007 to remove Kym from Rachel Street. Since about March 2007 Mrs Byrnes and Mr Kendle have lived apart. Mr Kendle moved in with his daughter. His grandson Mr Reece Smith moved into Rachel Street in July 2007 and paid $100 per week. This was applied by Mr Kendle's daughter to off-set her expenses in caring for her father. On or about 23 March 2007 Mrs Byrnes assigned by deed to Mr Martin Byrnes her interest in Rachel Street, including her rights in connection with the 1997 Deed, in consideration of $40,000. Upon removal of a caveat, the sale of Rachel Street was completed on 12 September 2008. By consent, the District Court of South Australia ordered that the net proceeds of $124,681.99 be held in the trust account of Mr Kendle's solicitor, pending the outcome of the litigation instituted by Mrs Byrnes and her son in that Court. The net proceeds were computed after deduction from the sale price of $145,000 of various costs and disbursements, including $13,107.53 to pay out the Westpac mortgage. The litigation The relief sought against Mr Kendle in the District Court litigation was variously described in the pleadings. It included an order for payment to the plaintiffs of one half of the net proceeds, an order that Mr Kendle provide a full accounting in connection with Rachel Street and an order that moneys found to be due as a result of the account be deducted from his share of the net proceeds. There were many issues in the litigation, but as it has reached this Court on appeal from the Full Court of the Supreme Court of South Australia (Doyle CJ, Nyland and Vanstone JJ)59 the live issues centre upon the liability of Mr Kendle as trustee in respect of the failure to recover from his son rent in respect of Rachel Street. The references to accounting by Mr Kendle as trustee indicate the several senses in which the term "duty to account" may be used, namely, (i) a duty to keep records, (ii) a duty to report to the beneficiaries or to the court concerning the administration of the trust, and (iii) a duty to pay amounts the trustee is obliged to pay to the beneficiaries60. 59 Byrnes v Kendle (2009) 267 LSJS 43. 60 Scott and Ascher on Trusts, 5th ed (2007), vol 3, §17.4, fn 1. With respect to (i) and (ii), and as a matter of first principle, a trustee should gain no advantage by failure to keep proper records and the court will resolve doubts against a trustee who fails to do so61. The nature of the principal complaint against Mr Kendle, of failure to obtain any rent in respect of Rachel Street over a long period, is such as to posit the taking of accounts on the basis of wilful neglect and default, in the sense described in Meehan v Glazier Holdings Pty Ltd62. For his part, Mr Kendle claims to "set-off", in any taking of accounts for the period from January 2002 to the completion of the sale of Rachel Street on 12 September 2008, the amounts he paid for rates, and mortgage and other payments in respect of that property. (The claim from 1994 and the period while Rachel Street was the matrimonial home appears no longer to be pressed by Mr Kendle.) This aspect of the dispute was not considered by the trial judge and he made a declaration that Mr Kendle held one half of the net proceeds of sale in trust for Mr Martin Byrnes. In the Full Court, Doyle CJ (with whom Nyland and Vanstone JJ agreed) did not enter upon the question of "set-off", the matter not having been raised by Mr Kendle either in his Notice of Cross-Appeal to the Full Court or in his Notice of Contention. In this Court, by his Notice of Contention Mr Kendle seeks to agitate the question and it will be necessary to return to it when considering the question of remedies. On the appeal to this Court there are five principal issues: (i) was there a trust created by the 1997 Deed; (ii) if so, what were the duties of Mr Kendle with respect to the renting out of the Rachel Street property after he and his wife moved out in December 2001; (iii) was there a breach of those duties; (iv) if so, did Mrs Byrnes (and thus her son, who takes as her assignee) consent to or acquiesce in the breach; (v) if she did not, what is the appropriate form of relief to the appellants for the breach of trust by the respondent? Was there a trust? The first issue should be decided in favour of Mrs Byrnes. The 1997 Deed was effective in its terms to vest in Mrs Byrnes as beneficiary a one undivided half interest as tenant in common in Rachel Street. 61 Kemp v Burn (1863) 4 Giff 348 at 349-350 [66 ER 740 at 740-741]; Scott and Ascher on Trusts, 5th ed (2007), vol 3, §17.4. cf Trustee Act 1936 (SA), s 84B. 62 (2002) 54 NSWLR 146 at 149-150 [14]-[15], 163 [65]-[66]. Rachel Street is land under the provisions of the Torrens system provided by the Real Property Act 1886 (SA) and s 162 thereof requires that no particulars of a trust shall be entered upon the Register Book. However, as Higgins J indicated in the early years of the Court63, and Griffith CJ explained in Barry v Heider64, and as has been long accepted, the title by registration under the Torrens system, such as that of Mr Kendle, is subjected to the enforcement by a court of equity of a trust, such as that created by the 1997 Deed. Section 29(1)(b) of the Law of Property Act required that a declaration of trust respecting "any land or any interest therein", such as that in Rachel Street, "be manifested and proved by some writing signed by some person who is able to declare such trust". The words quoted have a legislative history beginning with s 7 of the Statute of Frauds 167765. As explained in Kauter v Hilton66, s 7 did not require that a trust of land be created by writing, but that, however created, the trust "be manifested and proved by writing". In Bahr v Nicolay [No 2]67 Mason CJ and Dawson J approved of the expression of the "traditional attitude" by du Parcq LJ68 that "unless an intention to create a trust is clearly to be collected from the language used and the circumstances of the case, I think that the court ought not to be astute to discover indications of such an intention". In the present case there was no degree of informality, the trust being manifested and proved by deed using the technical term "upon trust". Accordingly, to adopt what was said in Associated Alloys Pty Ltd v ACN 001 452 106 Pty Ltd (In liq)69: "This is not one of those cases where the language employed by the parties for the transaction is inexplicit so that the court is left to infer the relevant intention from other language used by them, from the nature of 63 Fink v Robertson (1907) 4 CLR 864 at 891; [1907] HCA 7. 64 (1914) 19 CLR 197 at 206; [1914] HCA 79. 65 29 Car II c 3. 66 (1953) 90 CLR 86 at 98; [1953] HCA 95. 67 (1988) 164 CLR 604 at 618; [1988] HCA 16. 68 In re Schebsman; Official Receiver v Cargo Superintendents (London) Ltd [1944] Ch 83 at 104. 69 (2000) 202 CLR 588 at 605 [34]; [2000] HCA 25. the transaction and from the circumstances attending the relationship between the parties." (footnote omitted) However, by his Notice of Contention in this Court, Mr Kendle relies upon the statement by the trial judge (Judge Boylan)70: "In my view, this case turns upon Mr Kendle's intention. In determining whether or not an express trust has been created the court may look at evidence outside the Trust Deed to determine the intention of the alleged settlor. The Acknowledgement of Trust signed in 1997 did not create an express trust of which Mrs Byrnes was a beneficiary. When Mr Kendle signed that document he intended only to acknowledge that, upon eventual sale of the property, half of the net proceeds would belong to his wife. That view is consistent with the way he viewed the arrangement and with the way in which he dealt with the property." (footnote omitted) The Notice of Contention is necessary because Doyle CJ, who gave the leading judgment in the Full Court, disagreed with the trial judge, and indicated that an inquiry into the subjective state of mind and understanding of Mr Kendle could not displace the effect of the 1997 Deed71. Counsel for the appellants emphasised the exiguous and equivocal oral evidence given by Mr Kendle as to his intention upon which the trial judge relied. In addition, and more fundamentally, evidence of this nature was inadmissible. In that regard, it is important to observe that the trust asserted against Mr Kendle was not said to further or be associated with an illegal purpose72. Nor was the 1997 Deed said to be a "sham" in the sense explained in Raftland Pty Ltd v Federal Commissioner of Taxation73, and there was no plea of non est factum as described in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd74. Nor was there any claim to rescission of the 1997 Deed upon any of the grounds upon which that remedy is available in equity. Finally, the maxim that "equity looks to 70 Byrnes v Kendle [2009] SADC 36 at [33]. 71 (2009) 267 LSJS 43 at 47 [30]. 72 cf Nelson v Nelson (1995) 184 CLR 538. 73 (2008) 238 CLR 516 at 531-532 [35], 567 [173]-[174]; [2008] HCA 21. 74 (2004) 219 CLR 165 at 181-182 [46]-[47]; [2004] HCA 52. See also the discussion by White J in Forrest v Cosmetic Co Pty Ltd (2008) 218 FLR 109 the substance rather than the form" would be misapplied and misunderstood if used to warrant "the substitution of a different transaction for the one into which the parties [to the 1997 Deed] have entered"75. The fundamental rule of interpretation of the 1997 Deed is that the expressed intention of the parties is to be found in the answer to the question, "What is the meaning of what the parties have said?", not to the question, "What did the parties mean to say?" The point is made as follows, with reference to several decisions of Lord Wensleydale76, in Norton on Deeds77: "The word 'intention' may be understood in two senses, as descriptive either (1) of that which the parties intended to do, or (2) of the meaning of the words that they have employed; here it is used in the latter sense." Dixon J78 and Starke J79 spoke to similar effect when construing the terms of wills creating testamentary trusts. Where an express inter vivos trust respecting land or any interest in land is manifested and proved by some informal writing, or an express inter vivos trust of personalty is said to have been created by informal writing or orally, then a dispute as to the presence of the necessary intention, despite inexplicit language, is resolved by evidence of what the Court in Kauter v Hilton80 identified as "[a]ll the relevant circumstances". 75 K D Morris & Sons Pty Ltd (In liq) v Bank of Queensland Ltd (1980) 146 CLR 165 at 199 per Aickin J; [1980] HCA 20. 76 Grey v Pearson (1857) 6 HLC 61 at 106 [10 ER 1216 at 1234]; Abbott v Middleton (1858) 7 HLC 68 at 114 [11 ER 28 at 46]. 77 Norton, A Treatise on Deeds, 2nd ed (1928) at 50. 78 Currie v Glen (1936) 54 CLR 445 at 458; [1936] HCA 1. 79 Brennan v Permanent Trustee Co of New South Wales Ltd (1945) 73 CLR 404 at 412; [1945] HCA 17. 80 (1953) 90 CLR 86 at 100. But the object of this evidentiary odyssey does not change, and the nature of the intention of the alleged settlor does not differ. The question, as Megarry J put it81, "is whether in substance a sufficient intention to create a trust has been manifested". The point was made by Lord Millett in Twinsectra Ltd v Yardley82: "A settlor must, of course, possess the necessary intention to create a trust, but his subjective intentions are irrelevant. If he enters into arrangements which have the effect of creating a trust, it is not necessary that he should appreciate that they do so; it is sufficient that he intends to enter into them." There is good sense in such a rule. Issues of the construction to be placed upon the words or actions of alleged settlors are apt to arise long after the event. For example, the dispute in Kauter v Hilton83 arose between the executors of the will of Mr Hickey (who had died in 1950) and his niece, and concerned the construction to be placed upon his words and acts respecting certain bank accounts in the last five years of his life. Further, trusts give rise to proprietary interests, dealings which may engage third parties who are strangers to the original actors. In the first edition of his treatise, published in 1939, Professor Austin Wakeman Scott wrote under the heading "Requirement of manifestation of intention" in these terms84: "An express trust, unlike a constructive trust, is created only if the settlor properly manifests an intention to create a trust. It is not enough that he secretly intends to create a trust; there must be an outward expression of his intention. There are situations where the legal effect is dependent upon a person's actual intention; thus, for example, if he is charged with the crime of larceny, his actual intention is of importance. Ordinarily, however, the legal effect of a transaction does not depend upon the secret intention of a party to the transaction but upon the outward manifestation of intention. For practical reasons his undisclosed state of mind is regarded as immaterial. In the interest of accuracy, therefore, it is necessary in dealing with the creation of a trust and the terms of the trust 81 In re Kayford Ltd (In liq) [1975] 1 WLR 279 at 282; [1975] 1 All ER 604 at 607. 82 [2002] 2 AC 164 at 185 [71]. See also Mills v Sportsdirect.com Retail Ltd [2010] 2 BCLC 143 at 158 [52]-[54]. 83 (1953) 90 CLR 86. 84 Scott, The Law of Trusts, (1939), vol 1, §23. to speak not of the settlor's intention but of his manifestation of intention. Although the latter phrase may ring harshly in the ears of lawyers, one who wishes to write accurately can hardly avoid the use of it." (footnote omitted) The substance of this passage is now expressed in the current edition of Scott and Ascher on Trusts as follows85: "In some situations, legal consequences do turn on actual intentions, as in the case of those charged with certain crimes. Ordinarily, however, the legal effect of a transaction does not depend on the parties' secret intentions, but on the outward manifestations of their intentions. For practical reasons, we disregard the parties' undisclosed states of mind. To be accurate, therefore, it is necessary, when dealing with the creation of a trust and its terms, to speak not of the settlor's intention but of the settlor's manifestation of intention." Likewise, the "objective theory" of contract formation, which, as Mason ACJ, Murphy and Deane JJ put it in Taylor v Johnson86, stands "in command of the field", is concerned not with "the real intentions of the parties, but with the outward manifestations of those intentions"87. While the origins and nature of contract and trust are quite different, there is, as Mason and Deane JJ observed in Gosper v Sawyer88, no dichotomy between the two. For example, a common form of express trust is that created by covenant between settlor and trustee. Hence the significance of consistency between trust and contract with respect to matters of intention in contract formation and trust declaration. In the 11th edition of Lewin on Trusts, published in 1904, it was said89: "It is obviously essential to the creation of a trust, that there should be the intention of creating a trust, and therefore if upon a consideration of all the circumstances the Court is of opinion that the settlor did not mean 85 5th ed (2006), vol 1, §4.1. 86 (1983) 151 CLR 422 at 429; [1983] HCA 5. 87 (1983) 151 CLR 422 at 428. 88 (1985) 160 CLR 548 at 568-569; [1985] HCA 19. See also Associated Alloys Pty Ltd v ACN 001 452 106 Pty Ltd (In liq) (2000) 202 CLR 588 at 603 [26]-[28] per Gaudron, McHugh, Gummow and Hayne JJ. 89 Lewin, A Practical Treatise on the Law of Trusts, 11th ed (1904) at 85. to create a trust, the Court will not impute a trust where none in fact was contemplated." (emphasis in original; footnote omitted) The difficulty with this passage lies in the cryptic phrase "the settlor did not mean …". The authorities cited for that passage, Gaskell v Gaskell90, Hughes v Stubbs91, Smith v Warde92, and In re Pitt Rivers93, all shared a particular characteristic. This was that the alleged trust was created informally by a deceased settlor, and upon consideration of his correspondence and other relevant circumstances the court held that no trust had been created. In Commissioner of Stamp Duties (Q) v Jolliffe94, the primary judge (Lukin J) had admitted evidence given by Mr Jolliffe that he had opened a savings bank account as trustee for his wife (now deceased) not to make a gift to her but for the sole purpose of procuring interest not payable by the bank if the account stood in his name alone. The issue identified on the grant of special leave to appeal had been whether the effect of the Queensland Government Savings Bank Act 1916 (Q) ("the 1916 Act") and the written evidence precluded Mr Jolliffe from averring that he was not trustee of the money in the account at the death of his wife. In Jolliffe the passage from Lewin on Trusts which has been set out above was relied upon by the majority (Knox CJ and Gavan Duffy J)95, in the absence of citation of any other authority, as denying the proposition that "by using any form of words a trust can be created contrary to the real intention of the person alleged to have created it". This statement was applied by Napier J in Starr v Starr96, and in further decisions concerning bank accounts which were collected by Williams J in Teasdale v Webb97 and by Bray CJ in In re Lamshed98. In 90 (1828) 2 Y & J 502 [148 ER 1017]. 91 (1842) 1 Hare 476 [66 ER 1119]. 92 (1845) 15 Sim 56 [60 ER 537]. 94 (1920) 28 CLR 178; [1920] HCA 45. 95 (1920) 28 CLR 178 at 181. 96 [1935] SASR 263 at 267. 97 (1940) 57 WN (NSW) 151 at 153. 98 [1970] SASR 224 at 239. Hyhonie Holdings Pty Ltd v Leroy99, Young CJ in Eq referred to the 17th edition of Lewin on Trusts100, where it was said that today the dissenting reasons of Isaacs J in Jolliffe would be preferred in England to those of the majority. There were some indications in 19th century cases that the effect of legislation might be to deny, for evasion of a statutory regime, what otherwise might have been an effective declaration of trust101. The issue presented in Jolliffe was rather different. The terms of the 1916 Act at stake provided that, save as trustee for another, no person was to have more than one account with the bank, and also imposed a limit on the amount on which interest might be paid. Was the effect of the 1916 Act to impose a "statutory trust" upon an account holder depositing money ostensibly as trustee for another person, and to preclude any averment by the account holder that there was no trust102? This appears to have been the submission by the appellant103, and was rejected by Knox CJ and What the Court did not have before it in Jolliffe was a submission which was distinct from reliance upon any "statutory trust" or upon any express or implied statutory prohibitions upon denial of a trust. In particular, there was no application of the reasoning seen in Nelson v Nelson105 and most recently applied in Miller v Miller106. Anticipating those decisions, the inquiry in Jolliffe would have been whether the legislative purpose of the 1916 Act would not be fulfilled unless there were disregarded any further circumstances which tended to deny the terms on which the trust account was opened and conducted. The answer "yes" would mean that even if evidence of the "real intention" of Mr Jolliffe had 99 [2003] NSWSC 624 at [38]. An appeal was dismissed by the Court of Appeal: [2004] NSWCA 72. 100 Lewin on Trusts, 17th ed (2000) at 81 [4-23], fn 6. 101 Field v Lonsdale (1850) 13 Beav 78 at 81 [51 ER 30 at 31]. See also Gaskell v Gaskell (1828) 2 Y & J 502 at 509 [148 ER 1017 at 1020], where it was said to be "evident that these transfers were made with an intent to evade the legacy duty". 102 cf Williams v McIntosh (1909) 9 SR (NSW) 391. 103 Commissioner of Stamp Duties (Q) v Jolliffe (1920) 28 CLR 178 at 180. 104 Commissioner of Stamp Duties (Q) v Jolliffe (1920) 28 CLR 178 at 181-182. 105 (1995) 184 CLR 538. 106 (2011) 85 ALJR 480; 275 ALR 611; [2011] HCA 9. been admissible, that intention would have had to yield to the policy of the statute, and the appeal by the Commissioner should have been allowed. There are indications in the dissenting reasons of Isaacs J in Jolliffe107 that his Honour foresaw such an argument, but it is unnecessary here to pursue the matter. What is important for the present case is that Jolliffe should not be regarded as retaining any authority it otherwise may have had for the proposition that where the creation of an express trust is in issue, regard may be had to all the relevant circumstances not merely to show the intention manifested by the words and actions comprising those circumstances, but to show what the relevant actor meant to convey as a matter of "real intention". It follows that Doyle CJ correctly disagreed with the primary judge on the first issue. The second and third issues may be taken together. What were the duties of Mr Kendle to rent out Rachel Street? Did he breach those duties? As a general proposition, where the trust estate includes land, it is the duty of the trustee to render the land productive by leasing it, and this is so even if the trust instrument does not expressly so provide108. The benefit of the obligation of the tenant to pay the rent reserved, the performance of which is the means by which the trust property is rendered productive, will be held by the trustee for the trust. In the present case, the 1997 Deed identified the parties, Mr Kendle and Mrs Byrnes, as residing at Rachel Street, and made no express provision for the renting out of the property if, as occurred in 2001, they moved elsewhere. However, upon ordinary principles, Mr Kendle then was obliged to render Rachel Street productive by leasing it during the remainder of their joint lives. Thereafter, clauses 2 and 3, respectively, of the 1997 Deed (which adopted those clauses in the 1989 Deed) made special provision for the survivor to enjoy a life interest in the tenancy in common of the deceased, terminable upon the disposal of the survivor's interest. It is unnecessary here further to consider the operation of clauses 2 and 3. The trial judge found that the parties agreed not to use a real estate agent to find a tenant for Rachel Street, and that they had agreed that Mr Kendle would 107 (1920) 28 CLR 178 at 191-192. 108 Scott and Ascher on Trusts, 5th ed (2007), vol 3, §18.1.3. find a tenant and collect the rent; with Mrs Byrnes's knowledge Mr Kendle then rented the property to his son Kym. In the Full Court, Doyle CJ disposed of the trust case presented by Mrs Byrnes and her son on the footing that (a) if the parties had simply been co-owners, there would have been no fiduciary relationship between them and no obligations on either of them to ensure that the property was tenanted, and (b) this putative state of affairs was a guide to the answer to the question of duties owed by Mr Kendle as a trustee, the trust having been a "device" used by the parties109. No other reason was given for the conclusion of the Chief Justice that there had been "no affirmative duty on Mr Kendle to let out the property" when the move was made to Graetz Street110. In the 1997 Deed, as previously in the 1989 Deed, the co-owners chose in a formal fashion to create a particular trust relationship. This operated upon what would have otherwise been the legal incidents of their co-ownership. It is to reverse the relationship between law and equity, and is without logic, to base considerations as to the obligations assumed by Mr Kendle as trustee from the position which would have obtained at common law had there been no trust. Doyle CJ did go on111 to posit the letting of Rachel Street to a tenant "on an ordinary commercial basis" and asked whether Mr Kendle would have been liable to make up unpaid rent. The answer must be that he would be obliged to take steps to protect and preserve the trust property, including, if necessary, to protect against the defaulting tenant. The question then becomes whether there was a breach of duty by Mr Kendle in failing to take steps to recover rent due but unpaid by the tenant of Rachel Street. This must be answered in the affirmative. Was there consent or acquiescence in the breach? Paragraph 19 of the defence pleaded in the District Court relied without distinction on consent, acquiescence, waiver and estoppel. The ambiguities in the term "waiver" in various areas of legal discourse were considered by Gummow, Hayne and Kiefel JJ, with the agreement of Heydon J, in Agricultural 109 (2009) 267 LSJS 43 at 48 [36]-[37]. 110 (2009) 267 LSJS 43 at 48 [38]. 111 (2009) 267 LSJS 43 at 49 [43]. and Rural Finance Pty Ltd v Gardiner112. In the present case "waiver" is best understood as a genus comprising consent, estoppel and acquiescence. The primary judge held that Mrs Byrnes had "co-operated" in the breach of trust, stating113: "She was well aware of her need to protect what she saw as her proprietary rights. Kym lived in the house for a little over six years. For all of that time, or nearly all of it, she was fully aware that he was not paying rent. Further, during those [six] years, she was present at numerous discussions with her son and her husband at which Martin Byrnes spelled out his view that Mr Kendle owed a duty to Mrs Byrnes to collect rent from Kym. She was well aware of the rights her son claimed for her but, for the sake of matrimonial harmony, she took no action. I find that, although unwillingly, she consented to her husband's decision not to press for rent. Equity should not hear her complaints now, only after the marriage has broken down." (emphasis added) In the Full Court, Doyle CJ stated his agreement with these findings114, although he preferred the terms "acquiescence" and "consent" to "co-operation". In this Court, counsel for the appellants made several criticisms of the above passage in the reasons of the primary judge. While she may have been able to seek an accounting by the trustee, Mrs Byrnes, as beneficiary, had no standing to sue to recover the rent115. If she was, through her son, protesting the situation, how was she consenting or acquiescing in it? The term "consent", when used with respect to breach of trust, expresses the principle that "[t]here is no reason for a court of Equity to enforce an equitable obligation in favour of a party who consented to its breach against a party who acted with knowledge of that consent". The words are those of Handley JA in Spellson v George116. His Honour added that while consent may take various forms, and while consent may operate as an estoppel, it means 112 (2008) 238 CLR 570 at 586-588 [49]-[55], 625 [162]; [2008] HCA 57. 113 [2009] SADC 36 at [42]. 114 (2009) 267 LSJS 43 at 50 [49]-[50]. 115 Schalit v Joseph Nadler Ltd [1933] 2 KB 79 at 83-84. 116 (1992) 26 NSWLR 666 at 669. "something more than a state of mind", and that "[t]he trustee must know of the consent prior to the breach"117. The findings by the primary judge in the above passage fell short of providing sufficient basis for defences of consent and estoppel. There remains the defence of acquiescence by Mrs Byrnes in the breach of trust. This, as explained by Deane J in Orr v Ford118, is best understood as requiring calculated (that is, deliberate and informed) inaction by her or standing by, which encouraged Mr Kendle reasonably to believe that his omissions were accepted or not opposed by her. Counsel for the appellants correctly emphasised the absence of evidence by Mr Kendle that there was no need for him to take steps to recover arrears of rent or to evict Kym because Mrs Byrnes accepted the actions and did not oppose their continuation. There was no pleading of a defence of laches. In any event, where presented in answer to a claim of breach of an express trust such as that manifested the defence would require aggravating circumstances such that the granting of the relief sought by the beneficiary would "give rise to serious and unfair prejudice to the defendant or a third party"119. No such case was presented by the defendant in this litigation. the 1997 Deed, Remedies To what remedies are the appellants entitled in this Court? Counsel submitted to the Full Court a joint memorandum which contains a detailed summary of payments by Mr Kendle on account of council rates, insurance premiums, mortgage payments to Westpac and payments to SA Water. Mr Kendle had several relevant capacities. As the mortgagor and registered proprietor he was liable to Westpac and the other relevant third parties to meet these outgoings. Before the determination of any accrual in favour of the interests of himself and Mrs Byrnes, and the fixing of sums payable from the net proceeds in the trust account of his solicitors, as trustee Mr Kendle is entitled to deduct (or, on a loose use of the term, to "set-off") the amount of these outgoings. 117 (1992) 26 NSWLR 666 at 669-670. 118 (1989) 167 CLR 316 at 337-338, 340; [1989] HCA 4. 119 Orr v Ford (1989) 167 CLR 316 at 341 per Deane J. The balance then is to be accounted for equally between the two sides to the litigation. For the period January 2002 to January 2007, $36,150 should have been received as rent, but Mr Kendle as trustee should be allowed the outgoings in total of $17,707.69. With respect to the occupancy of Mr Kendle's grandson between July 2007 and September 2008 the respondent accepts attribution of a rent of $140 per week for 60 weeks, giving a total of $8,400. Kym left Rachel Street early in 2007 and there was an interval before the grandson moved in. In all the circumstances there should be no accounting on the basis of a failure to let Rachel Street in that period. The outgoings for the period of the grandson's occupation total $4,454.91. If the appropriate additions of these amounts be made, from the total rental sum of $44,550 there should be allowed $22,162.60. This leaves $22,387.40 as the rent for which an allowance of one half ($11,193.70) should be made in favour of the appellants. This should be added to the half share ($62,341.00) otherwise payable to the appellants from the net proceeds of sale of Rachel Street, a total of $73,534.70. By reason of the assignment between the appellants, payment should be made to and a sufficient discharge received from The appellants should have the costs in the District Court and of the appeal and cross-appeal to the Full Court. No costs order appears to have been made by the Full Court on the re-opening application by the appellants which was dismissed on 25 March 2010 and this situation should not be disturbed. The respondent refers to provisions in the District Court statute and Rules which are said to have the effect that no costs order in the present case should be made in favour of the appellants unless it is just to do so in the circumstances. However, the salient feature of the litigation has been the refusal of the respondent to acknowledge his position as trustee under the 1997 Deed. There should be costs orders against the respondent with respect to the whole of the litigation. Orders The following orders should be made: (1) Appeal allowed with costs. (2) Orders 1 and 3 of the orders of the Full Court sealed 20 January 2010 be set aside and in place thereof it be ordered that: the appeal to the Full Court be allowed with costs; and the orders of the District Court made on 31 March 2009 and order 1 of the orders made on 22 June 2009 be set aside and in place thereof: declare that the solicitors for the respondent, Clifford Frank Kendle, be at liberty to account for the moneys held by them in trust pursuant to order 4 of the orders of the District Court made on 11 September 2008 by paying thereout to the first appellant, Martin Francis Byrnes, or as he may direct in writing, the sum of $73,534.70 and by paying the balance to Mr Kendle, or as he may direct in writing; order that: (A) Mr Kendle pay the costs of the appellants on a party and party basis of the trial and all applications filed in the District Court action; and the action otherwise be dismissed. HEYDON AND CRENNAN JJ. The questions which this lamentable and ill- starred litigation throws up are as follows. Was there a trust? Background. Did the "Acknowledgment of Trust" executed in 1997 create a trust? The trial judge held that it did not, because in his opinion evidence extrinsic to that Acknowledgment of Trust revealed that the alleged settlor did not intend to create a trust. For the legitimacy of taking that evidence into account he cited B & M Property Enterprises Pty Ltd (in liq) v Pettingill120. That case relied on Starr v Starr121, which in turn treated Commissioner of Stamp Duties (Qd) v Jolliffe122 as authority for the proposition that evidence was admissible to show that a written instrument alleged to constitute a trust was not intended so to operate. The Full Court of the Supreme Court of South Australia disagreed. It declined to read Jolliffe's case as requiring an examination of the alleged settlor's subjective intentions not recorded in the Acknowledgment of Trust. In this Court the respondent submitted that it was necessary for the appellants to establish a subjective intention by the respondent to create a trust, that the trial judge was best placed to assess the respondent's subjective intention in the light of his testimony, and that the Full Court should not have overturned the trial judge's finding of fact. This submission is incorrect. The trial judge's estimate of the respondent's evidence about subjective intention, and the evidence itself, was irrelevant. The submission rests on a fundamental but very common misconception. is material, Constitutional construction. that misconception, to consider some words of Charles Fried. He is a former Solicitor-General of the United States. He is a distinguished scholar. He is the conservative at the Harvard Law School. He expressed scorn for the notion that "in interpreting poetry or the Constitution we should seek to discern authorial intent as a mental fact of some sort." He said: "we would not consider an account of Shakespeare's mental state at the time he wrote a sonnet to be a more complete or better account of the sonnet than the sonnet itself." He disagreed in exposing 120 [2001] SASC 75 at [124]-[126]. 121 [1935] SASR 263 at 266-267. 122 (1920) 28 CLR 178 at 181; [1920] HCA 45. "with the notion that when we consider the Constitution we are really interested in the mental state of each of the persons who drew it up and ratified it." On that false notion, he said, the "texts of a sonnet or of the Constitution would be a kind of second-best; we would prefer to take the top off the heads of authors and framers – like soft-boiled eggs – to look inside for the truest account of their brain states at the moment that the texts were created." He continued123: "The argument placing paramount importance upon an author's mental state ignores the fact that authors writing a sonnet or a constitution seek to take their intention and embody it in specific words. I insist that words and text are chosen to embody intentions and thus replace inquiries into subjective mental states. In short, the text is the intention of the authors or of the framers." That approach to constitutional construction is consonant with s 109 of our Constitution. It provides in part: "When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail …". There is an inveterate linguistic usage in many of the cases on s 109 purporting to direct attention to what the intention of the Federal Parliament was in enacting a federal law said to be inconsistent with a law of a State. But the cases mean only the intention as revealed in the words of the law. That is because s 109 does not provide: "When what a law of a State was intended to say is inconsistent with what a law of the Commonwealth was intended to say, the latter shall prevail …". Statutory construction. These approaches to constitutional construction are matched by approaches to statutory construction. That is not surprising, given that the Constitution is contained in an Imperial statute. Soon after the Constitution came into force, O'Connor J correctly propounded a theory of statutory construction which stressed the irrelevance of the subjective intention of legislators. The construction of the statute depended on its intention, but only in the sense of the intention to be gathered from the statutory words in the light of surrounding circumstances124. Even if it were possible to establish the actual mental states of those drafting and voting for a Bill, the inquiry would be 123 "Sonnet LXV and the 'Black Ink' of the Framers' Intention", (1987) 100 Harvard Law Review 751 at 758-759 (emphasis in original, footnotes omitted). Fried attributes the reasoning to passages in Dworkin, Law's Empire, (1986) at 54-57 and 124 Tasmania v The Commonwealth and Victoria (1904) 1 CLR 329 at 358-359; [1904] HCA 11. For modern discussions, see Wilson v Anderson (2002) 213 CLR 401 at 417-419 [7]-[9]; [2002] HCA 29; Singh v The Commonwealth (2004) 222 CLR 322 at 335-336 [19]; [2004] HCA 43. irrelevant. The correct approach is also seen in an extra-curial pronouncement by Mr Justice Holmes, only five years before O'Connor J: "we do not deal differently with a statute from our way of dealing with a contract. We do not inquire what the legislature meant; we ask only what the statute means."125 In the words of the Seventh Circuit of the United States Court of Appeals: "Congress did not enact its members' beliefs; it enacted a text."126 Similarly, Lord Hoffmann described statutory construction as "the ascertainment of what … Parliament would reasonably be understood to have meant by using the actual language of the statute."127 However, in recent times in England128 and in New Zealand129, through similar common law developments, and in Australia by statute130, extrinsic materials have been routinely examined to ascertain what the legislature meant. It is but one of several objections to that usually unprofitable course that it does not comply with Fried's approach. Contractual construction. The approach taken to statutory construction is matched by that which is taken to contractual construction. Contractual construction depends on finding the meaning of the language of the contract – the intention which the parties expressed, not the subjective intentions which they may have had, but did not express131. A contract means what a reasonable person having all the background knowledge of the "surrounding circumstances" available to the parties would have understood them to be using the language in 125 Holmes, "The Theory of Legal Interpretation", (1899) 12 Harvard Law Review 417 126 Jones v Harris Associates LP 527 F 3d 627 at 633 (7th Cir 2008) (emphasis in original). 127 R (Wilkinson) v Inland Revenue Commissioners [2005] 1 WLR 1718 at 1723 [17]; [2006] 1 All ER 529 at 535. See also R (Westminster City Council) v National Asylum Support Service [2002] 1 WLR 2956 at 2958-2959 [5]; [2002] 4 All ER 128 Pepper (Inspector of Taxes) v Hart [1993] AC 593 at 630-640. 129 See Burrows, Statute Law in New Zealand, 3rd ed (2003) at 181-184. 130 Acts Interpretation Act 1901 (Cth), s 15AB, and equivalents in some other jurisdictions. 131 Deutsche Genossenschaftsbank v Burnhope [1995] 1 WLR 1580 at 1587; [1995] 4 All ER 717 at 724. See also Rabin v Gerson Berger Association Ltd [1986] 1 WLR 526 at 533; [1986] 1 All ER 374 at 379-380. the contract to mean132. But evidence of pre-contractual negotiations between the parties is inadmissible for the purpose of drawing inferences about what the contract meant unless "surrounding circumstances"133. And in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd this Court said134: it demonstrates knowledge of "It is not the subjective beliefs or understandings of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe." One reason why the examination of surrounding circumstances in order to decide what the words mean135 does not permit examination of pre-contractual 132 Chartbrook Ltd v Persimmon Homes Ltd [2009] AC 1101 at 1112 [14]. A fact known to one party but not reasonably available to the other cannot be taken into account: Bank of Credit and Commerce International SA v Ali [2002] 1 AC 251 at 272 [49]. Gleeson CJ, Gummow and Hayne JJ agreed with this in Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181 at 188 [11]; [2001] HCA 70. See also Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at 179 [40]; [2004] HCA 52. There is or may be considerable controversy in relation to whether the test turns on what background knowledge was reasonably available to the parties or on what knowledge they actually had; if the former, to whether the knowledge is what each party might reasonably have expected the other to know; and to whether the knowledge of third parties into whose hands the contract may fall is relevant. Similar problems can arise with trusts. The issues in the present case do not call for their resolution. 133 Chartbrook Ltd v Persimmon Homes Ltd [2009] AC 1101 at 1117-1121 [33]-[42]. 134 (2004) 219 CLR 165 at 179 [40] per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ. Thus the question is: "what would the first party have led a reasonable party in the position of the other party to believe the first party intended, whatever the first party actually intended?" See Hoffmann, "The Intolerable Wrestle With Words and Meanings", (1997) 114 South African Law Journal 656 at 661; Bank of Credit and Commerce International SA v Ali [2002] 1 AC 251 at 272-273 [51]. See also Ashington Piggeries Ltd v Christopher Hill Ltd [1972] AC 441 at 502; Pioneer Shipping Ltd v BTP Tioxide Ltd [1982] AC 724 at 736; Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 462 [22]; [2004] HCA 35. 135 That course is permissible, but how far is controversial. This Court said in Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 240 CLR 45 at 62-63 [39]; [2002] HCA 5 that until this Court had decided on whether there were differences between Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896; [1998] 1 All ER 98 and Codelfa Construction (Footnote continues on next page) negotiations is that the latter material is often appealed to purely to show what the words were intended to mean, which is impermissible. The rejected argument in Chartbrook v Persimmon Homes Ltd was that all pre-contractual negotiations should be examined, not just those pointing to surrounding circumstances in the mutual contemplation of the parties. The argument purported to accept that contractual construction was an objective process, and that evidence of what one party intended should not be admissible. But other parts of the argument undercut that approach. Mr Christopher Nugee QC submitted: "The question is not what the words meant but what these parties meant. … Letting in the negotiations gives the court the best chance of ascertaining what the parties meant."136 It would have been revolutionary to have accepted that argument. These conclusions flow from the objective theory of contractual obligation. Contractual obligation does not depend on actual mental agreement. "[P]arties may be bound by a contract to things which neither of them intended, and when one does not know of the other's assent. … [T]he making of a contract depends not on the agreement of two minds in one intention, but on the agreement of two sets of external signs, – not on the parties' having meant the same thing but on their having said the same thing." In consequence the actual state of mind of either party is only relevant in limited circumstances, for example, where one party relies on the common law defences of non est factum or duress; where misrepresentation is alleged; where one party is under a mistake and the other knows it138; where the contract is liable Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337; [1982] HCA 24, and if so which should be preferred, the latter case should be followed in Australia. The question has not been argued or decided in this Court. The opinions stated in Masterton Homes Pty Ltd v Palm Assets Pty Ltd (2009) 261 ALR 382 at 384-385 [1]-[4] and 406-407 [112]-[113] and Franklins Pty Ltd v Metcash Trading Ltd (2009) 76 NSWLR 603 at 616-618 [14]-[18], 621-622 [42], 626 [63] and 663-678 [239]-[305] must be read in this light. 136 Chartbrook Ltd v Persimmon Homes Ltd [2009] AC 1101 at 1108 (emphasis added). 137 Holmes, "The Path of the Law", (1897) 10 Harvard Law Review 457 at 463-464 (emphasis in original). 138 Taylor v Johnson (1983) 151 CLR 422 at 432; [1983] HCA 5. to be set aside by reason of equitable doctrines of undue influence, unconscionable dealing or other fraud in equity; where the equitable remedy of rectification is available; where a question of estoppel arises; or where there is a question whether the "contract" is a sham139. The construction of trusts. The rules for the construction of contracts apply also to trusts. Although the two institutions are distinct, that is not surprising. For one thing, as Mason and Deane JJ said140: "The contractual relationship provides one of the most common bases for the establishment or implication and for the definition of a trust." By "establishment" their Honours referred to deciding whether a trust existed. By "definition" they referred to ascertaining its terms. The two inquiries are closely related: for the terms of a document or oral dealing determine whether it creates a trust. For another thing, the same considerations which limit recourse to surrounding circumstances and oral testimony in relation to contracts applies in relation to trusts. In 1877 Lord Gifford said: "The very purpose of the written contract was to exclude disputes inevitably arising from the lubricity, vagueness, and want of recollection, or want of accurate recollection, of mere oral conversations occurring in the course of negotiations more or less protracted."141 And three centuries earlier Popham CJ said142: "it would be inconvenient, that matters in writing made by advice and on consideration and which finally import the certain truth of the agreement of the parties should be controlled by averment of the parties to be proved by the uncertain testimony of slippery memory." The goal of excluding disputes of this kind from litigation is thwarted by recourse to the same material in order to discover the background, and that is so whether the disputes are about whether a particular contract was created or a particular trust. 139 Conaglen, "Sham Trusts", (2008) 67 Cambridge Law Journal 176 at 178, 182 and 140 Gosper v Sawyer (1985) 160 CLR 548 at 568-569; [1985] HCA 19 (emphasis added). 141 Buttery & Co v Inglis (1877) 5 R 58 at 70. 142 Countess of Rutland's Case (1604) 5 Co Rep 25b at 26a-26b [77 ER 89 at 90]. The authorities establish that in relation to trusts, as in relation to contracts, the search for "intention" is only a search for the intention as revealed in the words the parties used, amplified by facts known to both parties. Thus in 1881 Sir George Jessel MR said143: "The settlement is one which I cannot help thinking was never intended by the framer of it to have the effect I am going to attribute to it; but, of course, as I very often say, one must consider the meaning of the words used, not what one may guess to be the intention of the parties." In 1934 Lord Wright said, speaking of a failed attempt to settle property on trust144: "the Court, while it seeks to give effect to the intention of the parties, must give effect to that intention as expressed, that is, it must ascertain the meaning of the words actually used. There is often an ambiguity in the use of the word 'intention' in cases of this character. The word is constantly used as meaning motive, purpose, desire, as a state of mind, and not as meaning intention as expressed. The words actually used must no doubt be construed with reference to the facts known to the parties and in contemplation of which the parties must be deemed to have used them: such facts may be proved by extrinsic evidence or appear in recitals: again the meaning of the words used must be ascertained by considering the whole context of the document and so as to harmonize as far as possible all the parts: particular words may appear to have been used in a special sense, which may be a technical or trade sense, or in a special meaning adopted by the parties themselves as shown by the whole document. Terms may be implied by custom and on similar grounds. But allowing for these and other rules of the same kind, the principle of the common law has been to adopt an objective standard of construction and to exclude general evidence of actual intention of the parties; the reason for this has been that otherwise all certainty would be taken from the words in which the parties have recorded their agreement or their dispositions of property." In 1970, in Gissing v Gissing Lord Diplock made it plain that a trust between spouses could be inferred from the conduct of the parties. He said145: 143 Smith v Lucas (1881) 18 Ch D 531 at 542. 144 Inland Revenue Commissioners v Raphael [1935] AC 96 at 142-143. 145 [1971] AC 886 at 906. "the relevant intention of each party is the intention which was reasonably understood by the other party to be manifested by that party's words or conduct notwithstanding that he did not consciously formulate that intention in his own mind or even acted with some different intention which he did not communicate to the other party. On the other hand, he is not bound by any inference which the other party draws as to his intention unless that inference is one which can reasonably be drawn from his words or conduct." Among the conduct relevant to inferring the trust was "what spouses said and did which led up to the acquisition of a matrimonial home". He took into account, as relevant to the inquiry, financial aspects of the transaction by which the matrimonial home was purchased, and the financial contributions of the parties. These are instances of "background circumstances". In 1986, in Eslea Holdings Ltd v Butts, another background circumstance, "commercial necessity", was held relevant to the inferring of a trust. It was a case where guarantees were held on trust, and the relevant "commercial necessity" turned on the scope of the business which the party guaranteed was engaging in146. In 1988 Mason CJ and Wilson J followed that approach when they said in Trident General Insurance Co Ltd v McNiece Bros Pty Ltd147: "the courts will recognize the existence of a trust when it appears from the language of the parties, construed in its context, including the matrix of circumstances, that the parties so intended. We are speaking of express trusts, the existence of which depends on intention. In divining intention from the language which the parties have employed the courts may look to the nature of the transaction and the circumstances, including commercial necessity, in order to infer or impute intention: see Eslea Holdings Ltd v Butts." The reference to "matrix of circumstances" is plainly a reference to well-known decisions of Lord Wilberforce on contractual interpretation148. Similarly, 146 (1986) 6 NSWLR 175 at 189-190. 147 (1988) 165 CLR 107 at 121; [1988] HCA 44 (emphasis added). 148 Prenn v Simmonds [1971] 1 WLR 1381 at 1384; [1971] 3 All ER 237 at 239; Reardon Smith Line Ltd v Yngvar Hansen-Tangen [1976] 1 WLR 989 at 997; [1976] 3 All ER 570 at 575. Deane J said that where it was said that a contract had created a trust of a promise, the contractual terms had to be construed "in context"149. In 1990, Priestley JA said in Walker v Corboy that, in deciding whether an agent for the sale of farm produce was a trustee of the proceeds or whether he and the principal stood only in the relationship of debtor and creditor, it was necessary to evaluate the "circumstances" and "background"150. He cited a decision of Sir George Jessel MR in which, in deciding against the existence of a trust or equitable duties, he took into account the nature of one party's business which was necessarily known to the others151. And Meagher JA said that in deciding whether there was a trust, it was necessary to look not only at "the particular provisions of the agreement of the parties", but also "the whole of the circumstances attending the relationships between the parties."152 In 1991, Gummow J said that the relevant intention to create a trust "is to be inferred from the language employed by the parties in question and to that end the court may look also to the nature of the transaction and the relevant circumstances attending the relationship between them"153. In England these principles have been applied to the construction of trust deeds controlling pension funds – first in the language of Lord Wilberforce's "matrix of fact"154, later without that reference. In that area one relevant aspect of the background is the fiscal background155, and the practice and requirements 149 Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 150 (1990) 19 NSWLR 382 at 385-386. 151 Kirkham v Peel (1880) 43 LT 171 at 172. 152 Walker v Corboy (1990) 19 NSWLR 382 at 397. 153 Re Australian Elizabethan Theatre Trust; Lord v Commonwealth Bank of Australia (1991) 30 FCR 491 at 503. See also Winterton Constructions Pty Ltd v Hambros Australia Ltd (1991) 101 ALR 363 at 370. Walker v Corboy and Re Australian Elizabethan Theatre Trust were followed in Di Pietro v Official Trustee in Bankruptcy (1995) 59 FCR 470 at 484. 154 Mettoy Pension Trustees Ltd v Evans [1990] 1 WLR 1587 at 1610; [1991] 2 All ER 155 Mettoy Pension Trustees Ltd v Evans [1990] 1 WLR 1587 at 1610-1611; [1991] 2 All ER 513 at 537; National Grid Co plc v Mayes [2001] 1 WLR 864 at 870 [18]-[20]; [2001] 2 All ER 417 at 423-424. of the tax authorities at the relevant time156. Another relevant aspect is that the beneficiaries under a pension scheme are usually not volunteers, but have rights with contractual and commercial origins in their contracts of employment which they pay for by their service and contributions157. Another relevant aspect is common practice in the field of pension schemes generally, as evinced in the evidence of actuaries and textbooks by practitioners in the field158. In 2000 Gaudron, McHugh, Gummow and Hayne JJ said that even if "the language employed by the parties … is inexplicit", the court can infer an intention to create a trust "from other language used by them, from the nature of the transaction and from the circumstances attending the relationship between the parties."159 Neither in England nor in Australia has the application of the principles for establishing and defining a trust been analysed with the sophistication devoted in England to their application in contract. However, in both English and Australian law the surrounding circumstances are material to the questions whether the words used created a trust and what its terms are. Accordingly, Conaglen was correct to say160: "The court's focus when construing the terms of [a] bilateral arrangement [creating a trust] is on the objective meaning that those terms would convey to a reasonable person, just as it is when construing contractual arrangements." 156 Stevens v Bell [2002] EWCA Civ 672, quoted in Ansett Australia Ground Staff Superannuation Plan Pty Ltd v Ansett Australia Ltd (2002) 174 FLR 1 at 56-57 157 Mettoy Pension Trustees Ltd v Evans [1990] 1 WLR 1587 at 1610; [1991] 2 All ER 513 at 537; Imperial Group Pension Trust Ltd v Imperial Tobacco Ltd [1991] 1 WLR 589 at 597; [1991] 2 All ER 597 at 605-606. 158 Mettoy Pension Trustees Ltd v Evans [1990] 1 WLR 1587 at 1611; [1991] 2 All ER 513 at 537-538; Stevens v Bell [2002] EWCA Civ 672. 159 Associated Alloys Pty Ltd v ACN 001 452 106 Pty Ltd (in liq) (2000) 202 CLR 588 at 605 [34]; [2000] HCA 25 (footnote omitted). In Australian Securities and Investments Commission v Citigroup Global Markets Australia Pty Ltd (No 4) (2007) 160 FCR 35 at 77 [281] the principles of contractual construction discussed above were applied to an inquiry into whether a fiduciary relationship founded on a contract existed. 160 Conaglen, "Sham Trusts", (2008) 67 Cambridge Law Journal 176 at 181. The question is what the settlor or settlors did, not what they intended to do. That truth tends to be obscured by constant repetition of the need to search for an "intention to create a trust". That search can be seen as concerning the first of the three "certainties" – what Dixon CJ, Williams and Fullagar JJ called "the established rule that in order to constitute a trust the intention to do so must be clear and that it must also be clear what property is subject to the trust and reasonably certain who are the beneficiaries." But the "intention" referred to is an intention to be extracted from the words used, not a subjective intention which may have existed but which cannot be extracted from those words. This is as true of unilateral declarations of alleged trust as it is of bilateral covenants to create an alleged trust. It is as true of alleged trusts which are not wholly in writing as it is of alleged trusts which are wholly in writing. In relation to alleged trusts which are not wholly in writing, the need to draw inferences from circumstances in construing the terms of conversations may in practice widen the extent of the inquiry, but it does not alter its nature. As with contracts, subjective intention is only relevant in relation to trusts when the transaction is open to some challenge or some application for modification – an equitable challenge for mistake or misrepresentation or undue influence162 or unconscionable dealing or other fraud in equity, a challenge based on the non est factum or duress defences, an application for modification by reason of some estoppel, an allegation of illegality163, an allegation of "sham"164, a claim that some condition has not been satisfied165, or a claim for rectification. But subjective intention is irrelevant both to the question of whether a trust exists and to the question of what its terms are. 161 (1953) 90 CLR 86 at 97; [1953] HCA 95. 162 Commissioner of Stamp Duties (Qd) v Jolliffe (1920) 28 CLR 178 at 191 per 163 Nelson v Nelson (1995) 184 CLR 538; [1995] HCA 25. 164 Conaglen, "Sham Trusts", (2008) 67 Cambridge Law Journal 176. Although this was not the way the decision was reasoned, Starr v Starr [1935] SASR 263 may be an example, for the three trusts appear to have been created by unilateral declarations of trust which the defendant treated as "mere formalities" (at 265). 165 Commissioner of Stamp Duties (Qd) v Jolliffe (1920) 28 CLR 178 at 191 per Jolliffe's case. The majority in Jolliffe's case relied on a passage in the eleventh edition of Lewin on Trusts166 stating that the court will not impute a trust where the settlor did not mean to create one. In the light of the authorities discussed above, that statement is wrong. The majority denied that "by using any form of words a trust can be created contrary to the real intention of the person alleged to have created it"167. Denials to that effect are incorrect as statements of the law generally. They can only be correct in particular statutory contexts which might justify them. In 2000 Lewin on Trusts168 stated that Isaacs J's "powerful dissent" would be preferred in England, and in 2008 that work again described Isaacs J's dissent as "powerful"169. His dissent is indeed powerful, and as a statement of trusts law generally it is to be preferred in Australia as well as England to the majority's statement in Jolliffe's case and the cases which have followed it. The 1997 Acknowledgment of Trust. Did the 1997 Acknowledgment of Trust create a trust? The opening language twice described it as a trust. Clause 1, a key operative provision, used the language of trust. These indications, not countered by any other aspect of the document, are more than sufficient to support the conclusion that it was a trust. But there are surrounding circumstances known to the parties pointing to that conclusion as well. By Recital D the parties acknowledged that their respective entitlements to interests in the Original Property which was the subject of the 1989 Acknowledgment of Trust were transferred into interests in the New Property at Rachel Street, which had been purchased with the proceeds of sale of the Old Property. The 1989 Acknowledgment of Trust had the same references to trust as the 1997 Acknowledgment of Trust, and cll 1-3 of the two Acknowledgments of Trust were close to identical. Nothing in either the 1997 Acknowledgment of Trust or the 1989 Acknowledgment of Trust to which it refers and which it replaces points against the existence of a trust. The oral evidence of the respondent was inadmissible on this question, and in any event was extremely obscure. Thus the 1997 Acknowledgment of Trust created a trust. 166 Lewin, A Practical Treatise on the Law of Trusts, 11th ed (1904) at 85. 167 Commissioner of Stamp Duties (Qd) v Jolliffe (1920) 28 CLR 178 at 181. 168 Lewin on Trusts, 17th ed (2000) at 81 [4-23] n 6. 169 Lewin on Trusts, 18th ed (2008) at 95 [4-23] n 12. Was it the duty of the respondent as trustee to let the property? that The submitted respondent Both the trial judge and the Full Court denied that the respondent was under a duty to let the property. That was correct while the respondent and the second appellant lived in the property. But it ceased to be correct in 2001, when the 1997 they moved elsewhere. Acknowledgment of Trust imposed no other duties on himself as trustee, and, in particular, no duty to recover rent. The submission fails, because the duty existed independently of the terms of the 1997 Acknowledgment of Trust. Even if there is no direction in the trust instrument that the trust property be invested, it is the duty of the trustee to invest the trust property subject to the limits permitted by the legislation in force under the proper law of the trust and subject to any limits stated in the trust document170. If there are no limits of that kind, a trustee who receives a trust asset, like an executor of a deceased estate, must "lay it out for the benefit of the estate."171 That is, it is the duty of a trustee to obtain income from the trust property if it is capable of yielding an income. If the property is money, it should be invested at interest or used to purchase income-yielding assets like shares. If the property consists of business assets, it should be employed in a business. If the property is lettable land, it should be let for rent172. And if the intended means of gaining an income turn out to be unsatisfactory, those means must be abandoned and others found. Were any limits on the duty of the respondent as trustee created by the legislation in force under the proper law of the trust (ie the law of South Australia)? Section 6 of the Trustee Act 1936 (SA) relevantly provides: "A trustee may, unless expressly forbidden by the instrument creating the trust – invest trust funds in any form of investment …" 170 Stafford v Fiddon (1857) 23 Beav 386 [53 ER 151]; Adamson v Reid (1880) 6 VLR (E) 164 at 167; Gilroy v Stephens (1882) 51 LJ Ch 834; Re Jones; Jones v Searle (1883) 49 LT 91; Wharton v Masterman [1895] AC 186 at 197. 171 Rocke v Hart (1805) 11 Ves Jun 58 at 60 [32 ER 1009 at 1010] per Sir William Grant MR. 172 Earl of Egmont v Smith (1877) 6 Ch D 469 at 476 (a strong holding, since the case concerned not an express trust, as in this appeal, but the special kind of trust which exists between vendor and purchaser of land after exchange of contracts but before completion); In re Byrne; Byrne v Byrne (1902) 19 WN (NSW) 141. The letting of land is an "investment" within the meaning of s 6(a). Sections 7-9 and 25C create or preserve other rules relating to investment, but it was not submitted that any of them prevented the trustee from having a duty to let the property. Thus the letting of land was not restricted. And there were no limits stated in the trust instrument which cut down the respondent's duty to invest the trust property (the land) by letting it. The Full Court held that if the "device" of a trust had not been used, Mrs Byrnes and Mr Kendle would have been co-owners, and this would have excluded any duty to let the property. The Full Court then appeared to hold that, even though Mr Kendle was a trustee, the co-ownership displaced the trust duties. That is not so. Whatever the position at law if there had been no trust, the position in equity once the trust was created was that Mr Kendle's duty as trustee prevailed. Counsel for the respondent also submitted that the respondent was a fiduciary, and that the law did not impose positive legal duties on fiduciaries. In the first place, that is a very over-simplified proposition in relation to fiduciaries. And, in the second place, the respondent was not just a fiduciary: he was a trustee. The respondent then submitted that if the respondent was a trustee, he was only a bare trustee, and a bare trustee had no active duties to perform and no duty to recover rent. But this is a circular and question-begging argument. Thus it was the duty of the respondent to let the property. Did the respondent as trustee breach his duty to let the property? The respondent attempted to carry out his duty to let the property by letting it to his son on a promise to pay rent. Subject to questions about the legitimacy of letting it to a close family member, particularly one as financially embarrassed as the son, this, at least initially, fulfilled the duty. However, the son paid hardly any rent. The respondent thereafter fell into breach of duty as trustee by failing either to ensure that the rent was paid, or, in default, to procure that the son be evicted much more speedily than he was and replaced by a more satisfactory tenant. Did the conduct of the second appellant disentitle her from complaint about the respondent's breach of trust? Neither the pleading of this issue nor what the courts below said about it is clear. This is not surprising in view of the unclarity of the applicable law. The trial judge found, after analysing the problem in terms of an inquiry about "cooperation", that "although unwillingly, [the second appellant] consented to her husband's decision not to press for rent." The Full Court found that she "concurred or acquiesced" in it. It also described her as having given "consent". The Full Court also said that the trial judge's "clear finding of fact" was "not really challenged on appeal". In fact it was, by ground 6 of both the original and the supplementary notice of appeal, and by argument. The respondent supported the reasoning of the Full Court. That reasoning accepted that the second appellant would not be disentitled from relief unless she knew the legal effect of what she was doing. It was not established that she did know the legal effect of what she was doing. In his evidence the respondent said: "[The second appellant] and I hoped that [the son] would pay rent arrears to us eventually, but he did not. [The second appellant] and I did not take any action until 2007 when we with help of my family … caused [the son] to leave the property." In cross-examination the respondent confirmed that evidence. He also accepted that at no stage did he say to the son that the son did not have to pay the rent. These answers establish that there was no abandonment of the trust's claim against the son and no consent, concurrence or acquiescence in any abandonment of it by the second appellant. The evidence of the second appellant does not contradict that position. Nor was she ever asked whether she consented to the respondent's inactivity. But it is desirable to examine the position more fully. The respondent was in breach of trust on every occasion the respondent declined to sue the son for failure to pay rent. The respondent, on whom the burden of proof lay, took the court to no evidence that the second appellant consented to or "concurred" in any of those breaches of trust in advance. Was there contemporaneous or subsequent conduct by the second appellant disentitling the appellants from relief? In Orr v Ford Deane J set out various meanings of "acquiescence". It is convenient to consider the circumstances of this case in the light of his analysis. "Strictly used, acquiescence indicates the contemporaneous and informed ('knowing') acceptance or standing by which is treated by equity as 'assent' (i.e. consent) to what would otherwise be an infringement of rights …." There was no evidence to support contemporaneous consent by the second appellant. Deane J then said that the word "acquiescence" is commonly used also to refer "to a representation by silence of a type which may found an estoppel by conduct"174. The respondent did not attempt to establish the ingredients of an estoppel by silence. Deane J further said that "acquiescence" is commonly used to refer to "acceptance of a past wrongful act in circumstances which give rise to an active waiver of rights or a release of liability"175. The conditions for "active waiver" were not established. Nor were the conditions for a "release of liability". Lord Westbury LC described those conditions thus in Farrant v Blanchford176: "Where a breach of trust has been committed, from which a trustee alleges that he has been released, it is incumbent on him to shew that such release was given by the cestui que trust deliberately and advisedly, with full knowledge of all the circumstances, and of his own rights and claims against the trustee; for it is impossible to allow a trustee who has incurred personal liability to deal with his cestui que trust for his own discharge upon any other ground than the obligation of giving the fullest information, and of shewing that the cestui que trust was well acquainted with his own legal rights and claims, and gave the release freely and without pressure or undue influence of any description." The evidence does not establish that the second appellant was acting deliberately and advisedly or with knowledge of her own rights and claims against the respondent. 173 (1989) 167 CLR 316 at 337; [1989] HCA 4. 174 (1989) 167 CLR 316 at 337. 175 Orr v Ford (1989) 167 CLR 316 at 337. 176 (1863) 1 De G J & S 107 at 119-120 [46 ER 42 at 46-47]. Deane J then said that "acquiescence" is commonly used to refer to "an election to abandon or not enforce rights"177. The evidence does not support election. Deane J then referred to two usages of the word "acquiescence" which he found unhelpful178: "First, it is sometimes used as an indefinite overlapping component of a 'gross laches' and/or catchall phrase also incorporating 'delay'. … Secondly, acquiescence is used as a true alternative to 'laches' to divide the field between inaction in the face of 'the assertion of adverse rights' ('acquiescence') and inaction 'in prosecuting rights' ('laches')". 'laches' or He then gave a third meaning179: "Thirdly, and more commonly, acquiescence is used, in a context where laches is used to indicate either mere delay or delay with knowledge, to refer to conduct by a person, with knowledge of the acts of another person, which encourages that other person reasonably to believe that his acts are accepted (if past) or not opposed (if contemporaneous)". There is no evidence of that encouragement, and the respondent did not give evidence that he had that belief. Finally, Deane J said that the expression "gross laches" referred to180: "circumstances where inaction or standing by (with knowledge) by a plaintiff over a substantial period of time assumes an aggravated character in that it will, if the plaintiff is granted the relief which he seeks, give rise to serious and unfair prejudice to the defendant or a third party." The grant of relief to the plaintiff appellants here will cause no prejudice to third parties and no prejudice (beyond the justice of the case) to the respondent. The respondent also contended, but did not plead, that the first appellant, who was assignee of the second appellant's rights, had waived his entitlement. 177 Orr v Ford (1989) 167 CLR 316 at 338. 178 Orr v Ford (1989) 167 CLR 316 at 338. 179 Orr v Ford (1989) 167 CLR 316 at 338. 180 Orr v Ford (1989) 167 CLR 316 at 341. That contention must be rejected. The supposed waiver was the first appellant's offer to "let go of" the relevant claims if the Rachel Street property was sold and he received a fair price for his half share. In short, he was seeking to settle a dispute. The offer was not accepted by the respondent and the dispute was not settled. Relief What relief should be granted in the light of the outgoings paid by the respondent as trustee which he was entitled to have taken into account? The appellants wavered between submitting that that question should be referred to the Full Court, and submitting that this Court should deal with it. In view of the small sums in dispute, the heavy costs already incurred and the litigious mishaps which have taken place, the parties should not be exposed to the expense and trouble of a further trip to the Full Court. The parties differ on whether the respondent ought to have obtained rent for the property in the 29 weeks between when the son left the premises in January 2007 and the grandson came in in July 2007. That difference is to be resolved in favour of the respondent. Taking into account the probable difficulties of tenanting the property, there was no breach of duty by the respondent in relation to that 29 week delay. The total figure for rent which ought to have been, but which was not, received is $44,550. The total figure for rates, insurance, mortgage payments and water charges for which the respondent, as trustee holding the legal title, was liable was $22,162.60. The appellants submitted that the correct approach was to take the figure which should have been received for rent; deduct the figure for outgoings, halve the difference, and give one half to the appellants. The respondent submitted that it is not correct to take that course because, although the rent was never paid, the outgoings were actually paid, and paid only by the respondent. It was said to be wrong that the appellants should get "half of the net rent without contributing anything by way of the outgoings". The flaw in the respondent's contention is that, while he paid the whole of the outgoings, he also failed to ensure receipt of any of the relevant rent. It is necessary to take the net figure derived by comparing what the respondent ought to have received ($44,550) with what he actually paid ($22,162.60), and giving the appellants half that net figure ($11,193.70). If that is done, full allowance is given for what, on the one hand, the respondent paid, and, on the other hand, the respondent failed to ensure the receipt of. The appellants obtain half the rent which the respondent should have got (less half the outgoings) because they are entitled to be compensated for the respondent's breach of trust; the respondent does not obtain the other half of the rent because he breached his trust in failing to get it in. There was a controversy whether, by reason of s 42(2) of the District Court Act 1991 (SA), no order as to costs should be made in favour of the appellants. Whether or not the other conditions stipulated in that provision are satisfied, it is clear that it is just in the circumstances to make the costs order proposed by Gummow and Hayne JJ. Among those circumstances are the complete failure of the respondent on all substantive points agitated on appeal, and the erroneous denial at all stages by the respondent of his trusteeship. The other orders proposed by Gummow and Hayne JJ should be made. The appellants submitted in effect that in order (2)(b)(i) line 2 there should not be inserted after "liberty" the words ", and to be obliged,". That submission may be accepted on the ground that the solicitors may be expected to pay in accordance with the reasoning of this Court.

HIGH COURT OF AUSTRALIA SZBYR & ANOR AND APPELLANTS MINISTER FOR IMMIGRATION AND CITIZENSHIP & ANOR RESPONDENTS SZBYR v Minister for Immigration and Citizenship [2007] HCA 26 13 June 2007 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation G O'L Reynolds SC with C D Jackson and M A Izzo for the appellants (instructed by Kazi & Associates) R J Beech-Jones SC with J A C Potts for the first respondent (instructed by Clayton Utz Lawyers) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS SZBYR v Minister for Immigration and Citizenship Immigration – Refugees – The appellants were refused a visa under s 36(2) of the Migration Act 1958 (Cth) ("the Act") – The appellants gave a statutory declaration to the Refugee Review Tribunal ("the Tribunal") – The Tribunal affirmed the decision not to grant a visa partly on the basis of discrepancies between the statutory declaration and the appellants' oral evidence – Whether relief was available to the appellants. Immigration – Refugees – s 424A of the Act, read with s 441A, requires that an applicant be given written notice of particulars of any information that would be a reason or a part of the reason for affirming a decision – Whether s 424A applied to the appellants' statutory declaration – Temporal scope of s 424A – Whether the Tribunal breached s 424A – Whether the Tribunal committed jurisdictional error – Meaning of "information" – Whether "information" included discrepancies or inadequacies in previously submitted evidence – Meaning of "reason, or a part of the reason". Administrative law – Constitutional writs – Certiorari and mandamus – Impact of discretionary considerations governing availability of relief – Whether relief should be denied on discretionary grounds for lack of a Convention nexus. Words and Phrases – "information", "reason, or a part of the reason". Migration Act 1958 (Cth), ss 36(1), 422B, 424A, 441A. GLEESON CJ, GUMMOW, CALLINAN, HEYDON AND CRENNAN JJ. The appellants are Indian citizens who arrived in Australia on 2 October 2002. They are husband and wife, although the facts surrounding their claim to refugee status largely concern the husband's previous marriage to a woman named Salima. After the appellants' arrival in Australia, they applied for a Protection (Class XA) Visa, which was refused by the respondent Minister's delegate on 21 November 20021. The Refugee Review Tribunal ("the Tribunal") refused the appellants' application for review of the delegate's decision. The Federal Magistrates Court rejected an application for judicial review of the Tribunal's refusal, and an appeal by the appellants to the Federal Court of Australia was dismissed. The resolution of the appeal to this Court depends on two matters: first, whether the Tribunal fell into jurisdictional error; and secondly, if it did, whether relief should follow. The resolution of these issues therefore turns on the proper construction of s 424A of the Migration Act 1958 (Cth) ("the Act") and the application of the correct principles regarding the discretionary grant of relief. No party sought leave to re-open the question of the construction given to s 424A by the majority of this Court in SAAP v Minister for Immigration and Multicultural and Indigenous Affairs2. However, this does not obviate the need to pay careful attention to the application of s 424A to the present facts. Likewise, notwithstanding some resistance on their behalf, the appellants' case cannot escape scrutiny in the light of the discretionary considerations identified in Re Refugee Review Tribunal; Ex parte Aala3 governing the grant of certiorari and mandamus. The appellants' claims The appellants' entitlement to a protection visa under s 36(2) of the Act depends on their being persons to whom Australia owes protection obligations, namely those who have a "well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion" within the meaning of Art 1A(2) of the Convention relating to the Status of Refugees done at Geneva on 28 July 1951 as amended by the Protocol relating 1 At the hearing of the appeal in this Court, the title of the proceeding was amended to reflect the first respondent's current portfolio. (2005) 79 ALJR 1009; 215 ALR 162. (2000) 204 CLR 82. Callinan Crennan to the Status of Refugees done at New York on 31 January 1967 ("the Convention"). The appellants contend that they fear persecution in India because of their religion. The female appellant's claim is largely dependent on the male appellant's claim, pursuant to s 36(2)(b) of the Act. In the decisions below, the appellants also referred to their membership of a particular social group, although the basis of this claim was never clearly expressed, and the appellants did not pursue it in this Court. The appellants are Ismaili Muslims and followers of the Aga Khan. Around 1992 or 1993, the male appellant was living in Hyderabad and met a woman named Salima whose familiy were Muslims of a different sect and a higher social status. Salima's family was said to be very influential in Hyderabad. Notwithstanding her family's disapproval, Salima married the male appellant in May 1997. Thereafter, the male appellant claims to have been falsely arrested, charged by the police and imprisoned on a number of occasions between early 1997 and December 2001, each time at the corrupt instigation of Salima's family. The male appellant also claimed to have suffered other forms of harassment at the hands of Salima's family, including an assault in 1997, and he feared the future repetition of such acts. The timing and circumstances of these episodes were not entirely clear, and there were significant discrepancies between the oral evidence which the appellants gave before the Tribunal and the content of their statutory declaration made on 25 October 2002 in support of their application for a protection visa. Some time around early 1999, Salima's father asked that the male appellant divorce Salima. The male appellant did so in March 1999 and thereafter in October 2000 married his present wife, the female appellant. The appellants were living in Hyderabad when they heard that Salima had committed suicide, at which point they moved to Mumbai (Bombay) in the apparent fear that the male appellant would be blamed for Salima's death. In Mumbai, the appellants claim that they were arrested for the death of Salima, gaoled for 15 days, and then released on unconditional bail. The appellants said that they were charged with murder, although the precise offence in question was not clear. The appellants claimed that the hostility of Salima's family towards them was motivated by a desire for revenge over Salima's death. After their release from prison, the appellants returned to Hyderabad and lived there and in a number of other places. Then in Mumbai they obtained a visa to travel to Australia. They left India using their own passports, apparently without any difficulty despite the outstanding charges relating to Salima's death. The appellants fear that, if they are returned to India, they will be imprisoned as a result of the outstanding charge relating to Salima's death, and that they will Callinan suffer continued animus from Salima's family. While in their statutory declaration the appellants claimed to fear hostility from "Muslim people" generally, there was no subsequent suggestion other than that they feared hostility from Salima's family, and from police acting at the instigation of Salima's family. The proceedings below The Minister's delegate was not satisfied that the appellants were persons to whom Australia owed protection obligations because such persecution as they feared was not for a Convention reason. The delegate concluded that the appellants' difficulties arose out of the male appellant's personal relationship with Salima and her family, which was "a private matter which falls outside the scope of the Convention", and while religious differences may have been involved, the male appellant's fear arose out of a "personal and longstanding conflict between [him] and his ex-wife's family over their relationship". Dissatisfied with this result, the appellants applied to the Tribunal for review of the delegate's decision. The application for review was filed on 2 December 2002, and the Tribunal wrote on 10 July 2003 to invite the appellants to attend a hearing which was held on 27 August 2003. That invitation was given pursuant to s 425 of the Act. Before the hearing, the Tribunal had received various documents including the appellants' statutory declaration of 25 October 2002 in support of their application for a protection visa. At the hearing, the appellants gave oral evidence and were questioned by the Tribunal. In particular, the Tribunal explicitly drew the male appellant's attention to discrepancies between his oral evidence and his written claims in the statutory declaration, and invited him to comment. The male appellant offered no comment or explanation other than to say that his memory was poor. Like the Minister's delegate, the Tribunal did not accept the appellants' claims and, in a decision dated 14 October 2003, dismissed their application for review. Fundamentally, the Tribunal was not satisfied that the appellants suffered persecution for a Convention reason. The Tribunal concluded that: "Taking into account all the evidence before me, I am satisfied that the [appellants] are involved, or have been involved, in a personal dispute and there is no Convention nexus. The [appellants] are not being targeted for reason of their religion, even though the claimed protagonist the father of [Salima] is not a follower of the Aga Khan. Nor are the [appellants] being targeted for reason of membership of a particular social group constituted by social status." Callinan Crennan The Tribunal did not consider the male appellant to be a reliable witness, and the "modifications and refinements between his written claims and his oral evidence", within his oral evidence, and between his and his wife's evidence led the Tribunal to conclude that he was not "entirely frank", especially as regards the circumstances of his alleged arrest in 2001. Other factors leading towards the rejection of the appellants' claims included the lack of documentary evidence, and the implausibility of the appellants' being able to leave India on passports in their own names, given the alleged existence of outstanding murder charges. In the Federal Magistrates Court, Raphael FM rejected the appellants' application for review of the Tribunal's decision4, and an appeal to the Federal Court (constituted by Madgwick J) was likewise dismissed5. The appellants were unrepresented, and in neither Court was substantial attention given to the operation of s 424A. The Federal Magistrate reasoned that neither the text of s 424A nor the decision in SAAP were of assistance to the appellants because "the essential reason for the decision of the Tribunal was that the [appellants'] claims were claims which had no Convention nexus" and that "whatever might be said in support of other technical breaches of the Tribunal's duty not to fall into jurisdictional error, it would not outweigh that one important point"6. In the Federal Court, Madgwick J said that "[r]ead charitably" the Federal Magistrate's reasoning was that "any criticism of the Tribunal arising from s 424A of [the Act] is not a valid ground for review in this case for the central reason that the Tribunal Member's decision was unaffected by any information to which s 424A might have applied", and so understood it did not disclose error7. The operation of s 424A Section 424A was inserted into the Act by the Migration Legislation Amendment Act (No 1) 1998 (Cth)8. It forms part of Div 4 of Pt 7 of the Act. [2005] FMCA 1137. The source of the Federal Magistrate's jurisdiction was s 483A of the Act, which was repealed by the Migration Litigation Reform Act 2005 (Cth) Sched 1 cl 28. The source of jurisdiction is now to be found in s 476 of the Act. [2005] FCA 1761. [2005] FMCA 1137 at [5], [9]. [2005] FCA 1761 at [5]. 8 Sched 3 cl 3. Callinan That Division begins with s 422B which provides that the Division is "taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it deals with". It should be noted that the decision in SAAP concerned the Act as it stood before the insertion of s 422B9. Section 424A provides as follows: "(1) Subject to subsection (3), the Tribunal must: give to the applicant, in the way that the Tribunal considers appropriate the circumstances, particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review; and ensure, as far as is reasonably practicable, that the applicant understands why it is relevant to the review; and invite the applicant to comment on it. The information and invitation must be given to the applicant: except where paragraph (b) applies – by one of the methods specified in section 441A; or if the applicant is in immigration detention – by a method prescribed for the purposes of giving documents to such a person. This section does not apply to information: that is not specifically about the applicant or another person and is just about a class of persons of which the applicant or other person is a member; or that the applicant gave for the purpose of the application; or that is non-disclosable information." (2005) 79 ALJR 1009 at 1035 [138]; 215 ALR 162 at 196. Section 422B was inserted by the Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth) Sched 1 cl 6. Callinan Crennan If sub-s (1) is engaged, sub-s (2)(a) relevantly directs attention to the methods of communication specified in s 441A of the Act. Each of the methods there specified requires transmission of a written document. Oral communication is not sufficient. A majority of this Court in SAAP determined two points about the operation of s 424A: first, that its effect was mandatory, in that a breach of the section constituted jurisdictional error10; second, that its temporal effect was not limited to the pre-hearing stage11. However, these propositions do not determine the outcome of this case, and attention must be given to the particular terms of par (a) of s 424A(1) and its operation upon the present facts. Had the second point in SAAP been decided differently, the present case would have been simpler to resolve: the scope for the operation of s 424A would have been exhausted once the appellants were invited to appear before the Tribunal pursuant to s 425 of the Act. Certainly, there was nothing in the conduct of that hearing which was of itself procedurally unfair and, given the presence of s 422B, it might be surprising if s 424A were interpreted to have an operation that went well beyond the requirements of the hearing rule at common law. Unlike SAAP, where the relevant "information" was testimony of the appellants' daughter which had been given in their absence, the "information" in this case consisted of the appellants' own prior statutory declaration, to which the Tribunal explicitly drew their attention during the course of the hearing. If the common law rules of procedural fairness applied, one would certainly not criticise the Tribunal's approach in this regard. However, it follows from SAAP that the Parliament has determined that, if s 424A is engaged, only written notice will suffice. This then requires close attention to the circumstances in which s 424A is engaged. Section 424A does not require notice to be given of every matter the Tribunal might think relevant to the decision under review. Rather, the Tribunal's obligation is limited to the written provision of "particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review". What, then, was the 10 (2005) 79 ALJR 1009 at 1026 [78], 1040 [173], 1046 [208]; 215 ALR 162 at 183, 11 (2005) 79 ALJR 1009 at 1024 [71], 1037 [154], 1045 [202]; 215 ALR 162 at 181, Callinan the appellants appeared to focus on "information" that the appellants say the Tribunal should have provided? In their written submissions, the requisite "information" as being the "inconsistencies" between their statutory declaration and oral evidence. However, in oral argument they focused on the provision of the relevant passages in the statutory declaration itself, from which the inconsistencies were later said to arise. Four points must be noted about this submission. First, while questions might remain about the scope of par (b) of s 424A(3), it was accepted by both sides that information "that the applicant gave for the purpose of the application" did not refer back to the application for the protection visa itself, and thus did not encompass the appellants' statutory declaration. In this regard, the parties were content to assume the correctness of the Full Federal Court decisions in Minister for Immigration and Multicultural Affairs v Al Shamry12 and SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs13. Accordingly, no occasion now arises for this Court to determine whether that assumption was correct. Secondly, the appellants assumed, but did not demonstrate, that the statutory declaration "would be the reason, or a part of the reason, for affirming the decision that is under review". The statutory criterion does not, for example, turn on "the reasoning process of the Tribunal", or "the Tribunal's published reasons". The reason for affirming the decision that is under review is a matter that depends upon the criteria for the making of that decision in the first place. The Tribunal does not operate in a statutory vacuum, and its role is dependent upon the making of administrative decisions upon criteria to be found elsewhere in the Act. The use of the future conditional tense ("would be") rather than the indicative strongly suggests that the operation of s 424A(1)(a) is to be determined in advance – and independently – of the Tribunal's particular reasoning on the facts of the case. Here, the appropriate criterion was to be found in s 36(1) of the Act, being the provision under which the appellants sought their protection visa. The "reason, or a part of the reason, for affirming the decision that is under review" was therefore that the appellants were not persons to whom Australia owed protection obligations under the Convention. When viewed in that light, it is difficult to see why the relevant passages in the appellants' statutory declaration would itself be "information that the Tribunal 12 (2001) 110 FCR 27. 13 (2006) 150 FCR 214. Callinan Crennan considers would be the reason, or a part of the reason, for affirming the decision that is under review". Those portions of the statutory declaration did not contain in their terms a rejection, denial or undermining of the appellants' claims to be persons to whom Australia owed protection obligations. Indeed, if their contents were believed, they would, one might have thought, have been a relevant step towards rejecting, not affirming, the decision under review. Thirdly and conversely, if the reason why the Tribunal affirmed the decision under review was the Tribunal's disbelief of the appellants' evidence arising from inconsistencies therein, it is difficult to see how such disbelief could be characterised as constituting "information" within the meaning of par (a) of s 424A(1). Again, if the Tribunal affirmed the decision because even the best view of the appellants' evidence failed to disclose a Convention nexus, it is hard to see how such a failure can constitute "information". Finn and Stone JJ correctly observed in VAF v Minister for Immigration and Multicultural and Indigenous Affairs that the word "information"14. the tribunal's subjective appraisals, "does not encompass thought processes or determinations … nor does it extend to identified gaps, defects or lack of detail or specificity in evidence or to conclusions arrived at by the tribunal in weighing up the evidence by reference to those gaps, etc". If the contrary were true, s 424A would in effect oblige the Tribunal to give advance written notice not merely of its reasons but of each step in its prospective reasoning process. However broadly "information" be defined, its meaning in this context is related to the existence of evidentiary material or documentation, not the existence of doubts, inconsistencies or the absence of evidence. The appellants were thus correct to concede that the relevant "information" was not to be found in inconsistencies or disbelief, as opposed to the text of the statutory declaration itself. 14 (2004) 206 ALR 471 at 476-477, citing Tin v Minister for Immigration and Multicultural Affairs [2000] FCA 1109 at [54]; Paul v Minister for Immigration and Multicultural Affairs (2001) 113 FCR 396 at 428; Singh v Minister for Immigration and Multicultural Affairs [2001] FCA 1679 at [25]; WAGP of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2002) 124 FCR 276 at 282-284. Callinan Fourthly, and regardless of the matters discussed above, the appellants' argument suggested that s 424A was engaged by any material that contained or tended to reveal inconsistencies in an applicant's evidence. Such an argument gives s 424A an anomalous temporal operation. While the Act provides for procedures to be followed regarding the issue of a notice pursuant to s 424A before a hearing15, no such procedure exists for the invocation of that section after a hearing. However, if the appellants be correct, it was only after the hearing that the Tribunal could have provided any written notice of the relevant passages in the statutory declaration from which the inconsistencies were said to arise, as those inconsistencies could not have arisen unless and until the appellants gave oral evidence. If the purpose of s 424A was to secure a fair hearing of the appellants' case, it seems odd that its effect would be to preclude the Tribunal from dealing with such matters during the hearing itself. Moreover, supposing the appellants had responded to a written notice provided by the Tribunal after the hearing, if inconsistencies remained in their evidence, would s 424A then oblige the Tribunal to issue a fresh invitation to the appellants to comment on the inconsistencies revealed by – or remaining despite – the original response to the invitation to comment? If so, was the Tribunal obliged to issue new notices for so long as the appellants' testimony lacked credibility? If the appellants' desired construction of s 424A leads to such a circulus inextricabilis, it is a likely indication that such a construction is in error. The short answer to all these points is that, on the facts of this case, s 424A was not engaged at all: the relevant parts of the appellants' statutory declaration were not "information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review". Section 424A has a more limited operation than the appellants assumed: its effect is not to create a back-door route to a merits review in the federal courts of credibility findings made by the Tribunal. That being so, this case does not require this Court to address the differences in opinion in the Federal Court concerning the "unbundling" of Tribunal reasoning16. 15 Notably, in the sequential interaction of ss 424A, 424B, 424C(2) and 425(2) of the Act. 16 Compare VAF v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 206 ALR 471 with SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 150 FCR 214. Callinan Crennan Once the limited scope of s 424A is appreciated, and once the proper meaning of the word "reason" in s 424A(1)(a) is discerned, the apparent need for "unbundling" is correspondingly reduced. The respondent Minister's concern about "minor" or "unimportant" matters engaging s 424A is largely to be resolved by the proper application of s 424A itself, not by any extra-statutory process of "unbundling". "Primary" and "residual" claims In this Court, the appellants placed great emphasis on the supposed disjuncture in the Tribunal's reasoning between the appellants' "primary claim", namely the laying of the false charge of murder in 2001, and the "residual claim", namely the fear that false charges would be laid in the future at the behest of Salima's family. This disjuncture was said to arise out of the Tribunal's use of the phrase "residual claim" in one passage in its reasoning when discussing the feared future actions of Salima's family. The consequence of this disjuncture, so the appellants said, was that the Tribunal's reasoning with respect to the lack of "Convention nexus" went only to the residual claim, and not to the primary claim. The primary claim, it was said, failed not for want of a Convention nexus, but solely because the male appellant was disbelieved as a result of the discrepancies between his oral evidence and his earlier statutory declaration. In turn, this alleged disjuncture led the appellants to argue that the Tribunal's alleged breach of s 424A with respect to the primary claim infected its finding about lack of Convention nexus with respect to the residual claim. It was said to be an "absurdity" and a "logical impossibility" to link the finding of lack of Convention nexus with the Tribunal's findings about the appellants' arrest in In truth, any absurdity arose only from the appellants' artificial construction of the Tribunal's reasons. The following words of Brennan CJ, Toohey, McHugh and Gummow JJ in Minister for Immigration and Ethnic Affairs v Wu Shan Liang are relevant here17: "[T]he reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed. In the present context, any court reviewing a 17 (1996) 185 CLR 259 at 272 (footnotes omitted). Callinan decision upon refugee status must beware of turning a review of the reasons of into a reconsideration of the merits of the decision." the decision-maker upon proper principles There was no logical inconsistency between on the one hand determining that, even taken at its highest, the appellants' evidence did not disclose a Convention nexus, and on the other hand finding that the appellants' evidence could not be wholly believed because of its inconsistency and implausibility. When read fairly – and certainly when read in light of the decision of the Minister's delegate – the Tribunal's reasons indicate that its finding about lack of Convention nexus applied to all of the appellants' claims, not just to some of them. The incidental use of the phrase "residual claim" did not require any contrary conclusion. Moreover, the appellants' lack of credibility regarding the acts comprising the so-called "primary claim" could not have affected the finding about lack of Convention nexus, as that latter finding was not credibility-based. Rather, it was inevitable even on the best view of the appellants' case. Discretion The respondent Minister raised the issue of discretionary relief by way of a Notice of Contention dated 16 February 2007. The Minister argued that, even if the appellants' arguments about s 424A were correct, their claim would be doomed to failure because of the absence of a Convention nexus, and thus the grant of certiorari or mandamus would be futile. This submission was not put to the courts below, and, given the conclusions expressed in these reasons that on the facts of this case s 424A had not been engaged at all, it is not critical for the Minister to rely upon it in this Court. However, it is convenient to say something on the subject. This Court has previously emphasised that the grant of the constitutional writs is a matter of discretion, and the same principles apply to the grant of relief by the Federal Magistrates Court and the Federal Court pursuant to s 39B of the Judiciary Act 1903 (Cth). In Aala, Gaudron and Gummow JJ noted that18: "Some guidance, though it cannot be exhaustive, as to the circumstances which may attract an exercise of discretion adverse to an applicant is indicated in the following passage from the judgment of Latham CJ, Rich, Dixon, McTiernan and Webb JJ in a mandamus case, 18 (2000) 204 CLR 82 at 108 [56]. Callinan Crennan R v Commonwealth Court of Conciliation and Arbitration; Ex parte Ozone Theatres (Aust) Ltd. Their Honours said19: 'For example the writ may not be granted if a more convenient and satisfactory remedy exists, if no useful result could ensue, if the party has been guilty of unwarrantable delay or if there has been bad faith on the part of the applicant, either in the transaction out of which the duty to be enforced arises or towards the court to which the application is made. The court's discretion is judicial and if the refusal of a definite public duty is established, the writ issues unless circumstances appear making it just that the remedy should be withheld.'" The present is a case in which no useful result could ensue from the grant of the relief desired by the appellants. This is so because, even if the appellants be correct as to the proper operation of s 424A, they cannot overcome the Tribunal's finding that their claims lacked the requisite Convention nexus. The appellants' case, like Mobil Oil Canada Ltd v Canada-Newfoundland Offshore Petroleum Board20, cited in Aala, was one in which "irrespective of any question of procedural fairness or individual merits, the decision-maker was bound by the governing statute to refuse"21. In this regard, the references that were made in the course of argument into "impeachable" and "unimpeachable" parts were more likely to mislead than to assist. While there may well be cases in which a tribunal's breach of s 424A affects its findings about the absence of a Convention nexus, this was not such a case. the "unbundling" of a Tribunal's reasons Orders The appeal should be dismissed with costs. 19 (1949) 78 CLR 389 at 400. 20 [1994] 1 SCR 202 at 228. 21 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 109 [58]. Kirby KIRBY J. This is an appeal from the Federal Court of Australia22. I agree in the order proposed in the reasons of Gleeson CJ, Gummow, Callinan, Heydon and Crennan JJ ("the joint reasons")23. The appeal must be dismissed. However, I would support the order solely on the ground explained in the concluding part of the joint reasons24. In my opinion, the appeal should be rejected, and relief denied, on the basis of the discretionary arguments advanced by the Minister in his Notice of Contention in this Court25. I would reserve my opinion on the many issues raised concerning the construction of s 424A of the Migration Act 1958 (Cth) ("the Act"). This is an area of the law where there is a multitude of decisional authority and a proliferation of dicta. Indeed, upon one view, the problem that arose in the present proceedings derived from comments made by the Refugee Review Tribunal ("the Tribunal"), in its reasons for decision, that were unnecessary to resolve the matter. From first to last, these proceedings were highly fact-specific. There was at all times a consistent, available and legally unimpeachable reason for affirming the decision under review, adverse to the appellants. Any controversy arising out of s 424A was therefore immaterial to the outcome26. In this respect, the appeal was distinguishable from the decision in SAAP v Minister for Immigration and Multicultural and Indigenous Affairs27. This Court should say so. We should not burden this field of law with more obiter dicta unnecessary to the disposition. The facts The general nature of the applications brought by SZBYR and SZBYS28 ("the appellants") for protection visas as "refugees" under the Act29 is set out in 22 SZBYR v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FCA 1761 (Madgwick J). 23 Those reasons also note the amendment of the title of the Minister so as to correspond with the current designation. 24 Joint reasons at [27]-[29]. 25 See joint reasons at [27]; reasons of Hayne J at [91]. 26 See also reasons of Hayne J at [92]. 27 (2005) 79 ALJR 1009; 215 ALR 162. 28 The names of the appellants were anonymised in accordance with s 91X of the Act. Kirby the joint reasons30. Inevitably, the facts were more complex, and detailed, than the summary provided there. But the essence of what happened is sufficiently stated. To be entitled to protection visas, the appellants, who are husband and wife and both nationals of India, were obliged to bring themselves within the requirements accepted by Australia pursuant to the Convention, as given effect by Australian law31. This necessitated the appellants proving that32: "[O]wing to a well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion [they were] outside the country of [their] nationality and … unable or, owing to such fear … unwilling to avail [themselves] of the protection of that country". The appellants sought to bring themselves within the requirement of "persecution" by proving harassment and unlawful criminal prosecutions for serious crimes, which the family of the male appellant's former wife, Salima, had allegedly instigated33. They sought to demonstrate a "well-founded fear" by showing "reasons" of "religion" or "membership of a particular social group". They did this by relying on the religious and social differences between the male appellant and his former wife's family. The female appellant's claim was derivative from that of her husband, the male appellant. The appellants and the family of the male appellant's former wife were all Muslims. However, both of the appellants were followers of the Aga Khan, known as Ismaili Muslims34. Country evidence adduced before the Tribunal affirmed that India is a secular State whose Constitution provides for freedom of 29 Pursuant to the Act, s 36(2). 30 Joint reasons at [3]-[6]. 31 Convention relating to the Status of Refugees done at Geneva on 28 July 1951; [1954] ATS 5; 189 UNTS 150. As amended by the Protocol relating to the Status of Refugees done at New York on 31 January 1967; [1973] ATS 37; 606 UNTS 267 (together "the Convention"). 32 Convention, Art 1A(2). Note also the Act, ss 91R, 91S. 33 See joint reasons at [3]-[5]. 34 Adherents of Islam whose members believe that Ismail, son of the sixth Imam, was the true seventh Imam. Kirby religion35. Whilst tension between Muslims and Hindus has posed "a challenge to the secular foundations of the State", and problems can arise, at State and local levels, as to the level of respect for religious freedom, the country information contained "no suggestion" that "followers of the Aga Khan are subjected to persecution by the authorities or the community at large." In dealing with the appellants' request for protection visas, the decision-makers below (as is usual) described the provisions of the Convention and various decisions concerning its basic requirements. They also recounted various aspects of the appellants' claims concerning the circumstances of their lives in India before their arrival in Australia in October 2002. There were doubts and contests over particular aspects of this history. Yet, as I shall show, at every level of decision-making, there was a consistent, simple reason which was fatal to the entitlement of the appellants to protection under the Convention. This was the conclusion that they did not have a well-founded fear of persecution for a Convention reason36. That is, the "reasons" for any "fear of persecution" on the part of the appellants did not include "religion" or "membership of a particular social group", as alleged, but merely concerned a private quarrel animated by hostility that existed between the male appellant and his former wife's family. The decisional record The Minister's delegate: That this was the decisive reason for the decisions at every level of decision-making is clear from a review of the record. It begins with the delegate of the Minister37 making the primary decision refusing protection visas to the appellants. The delegate concluded that the "fear of persecution on return to India is not for a Convention ground(s)". The delegate said: "The [male appellant's] difficulties, which arose as a result of his relationship with a woman from a different Muslim sect, is a private matter which falls outside the scope of the Convention. His decision to continue the relationship, in the face of repeated warnings and threats from the woman's family, is the essential and significant reason for the alleged mistreatment he suffered, rather than any Convention reason(s). 35 Constitution of India, Art 25. See also Arts 15, 16(2), 26-28; Seervai, Constitutional Law of India, 4th ed (1993), vol 2 at 1259-1308. 36 See also reasons of Hayne J at [91]. 37 Under the Act, s 65. Kirby The [male appellant's] fear of persecution if he returns is not for a Convention ground(s) but because of a personal and longstanding conflict between the [male appellant] and his ex-wife's family over their relationship." (original emphasis) Refugee Review Tribunal: The reason advanced by the delegate unsurprisingly became the focus of the review by the Tribunal, which the appellants promptly initiated. The Tribunal set out, at some length, the male appellant's evidence about harassment, arrest and hostility in India as a result, he claimed, of the antagonism of his former wife's family, both in her lifetime and after her alleged suicide. The Tribunal member acknowledged her obligation to consider whether the appellants had a "well-founded fear of persecution for a Convention reason". She noted their statement that they feared harm "including imprisonment and possibly death arising from the death of the [male appellant's] first wife". The Tribunal member made various critical observations concerning the male appellant's credibility. Amongst other things, she said: "[T]here are a number of aspects about the evidence before me which I find troubling. ... the [male appellant] did not impress me as a reliable witness. I found the modifications and refinement between his written claims and his oral evidence, within his oral evidence and the inconsistency with that of his wife's oral evidence as to when he was actually arrested in 2001 to be unsatisfactory. ... [There was] a willingness by the [male appellant] to tailor his evidence in a manner which suited his purposes rather than a willingness to be frank. … the evidence before me as to the precise character of the 2001 charge laid against the [appellants] is vague." However, these statements were then followed by the Tribunal's conclusion that leads to its disposition: "The [appellants] contend that the harm they fear is related to their religion. However, apart from a single reference made by Salima's brother to religion as being a factor in why the family disapproved of the relationship there is nothing in the evidence before me as to the [appellants'] actual experiences with Salima's family which provides any support to this contention. Kirby Taking into account all the evidence before me, I am satisfied that the [appellants] are involved, or have been involved, in a personal dispute and there is no Convention nexus … I do not accept the [appellants'] contention that religion or social status were in any way or at all factors in the harm they fear … ... I find that the motive for the harm which the [appellants] fear is because they have been ascribed with responsibility for a suicide. I further find that the harm which the [appellants] fear in the future arises out of this personal matter and is not Convention related. Accordingly I find that the harm the [male appellant] fears is from private individuals settling a private dispute and as such it does not constitute persecution of a kind which can attract protection under the Refugees Convention". Federal Magistrates Court: When an application for judicial review was made to the Federal Magistrates Court, Raphael FM, after recounting or extracting passages from the Tribunal's reasons, rejected the application for review on the basis that, essentially, it amounted to an endeavour to relitigate the factual conclusions of the Tribunal38. However, he went on to explain why he had refused the appellants an adjournment of the hearing following the late provision of the Minister's submissions. He said39: "[T]he granting of an adjournment would be of little utility because it seemed to me so clear from the decision of the Tribunal that the reason for refusal of the visa was the failure of the [appellants'] claim to have a Convention nexus, that whatever might be said in support of other technical breaches of the Tribunal's duty not to fall into jurisdictional error, it would not outweigh that one important point which … is the real matter that a court must consider." Federal Court of Australia: The appellants' appeal to the Federal Court specifically raised a ground complaining that the Tribunal had exceeded its jurisdiction in failing to conform to s 424A and in denying the appellants procedural fairness. The appellants were not legally represented in that Court. 38 SZBYR v Minister for Immigration and Multicultural and Indigenous Affairs [2005] FMCA 1137 at [6]. 39 [2005] FMCA 1137 at [9] (emphasis added). Kirby Part of the Federal Court's reasons was addressed to the failure of the Federal Magistrate to grant the appellants the adjournment which they had sought40. This is not a matter pursued in this Court. In dealing with the appellants' complaint that the Tribunal had misunderstood or misapplied the Convention criteria, Madgwick J quoted the passage from the Tribunal's reasons, part of which is set out above, characterising the appellants' conflicts in India as "a personal dispute [with] no Convention nexus"41. In default of an explanation of how this involved error or how the Federal Magistrate had failed to discern any such error in that passage, Madgwick J concluded: "the case simply appears to be devoid of legal merit"42. From the foregoing it follows that the appellants' appeal to this Court is singularly ill-suited to present an examination of the application to the facts of s 424A. To the extent that s 424A was considered, both by the Federal Magistrate and by the Federal Court, attention appears to have been confined to the suggested relevance of s 424A to the discretionary refusal to grant an adjournment, an issue not now in contention. I appreciate that, where parties are unrepresented in the courts below, and special leave is granted to appeal to this Court, formalistic impediments to the argument of legal questions essential to the lawful determination of the matter should not stand in the way of their consideration. On the other hand, where this Court does not have well focused reasons of the intermediate courts on such questions, addressed to the facts of the instant case, there is special reason for caution before launching into an elaboration of new issues of general significance and frequent application where that course is not legally essential. Discretionary dismissal of the application Basis of the jurisdiction: The Act does not provide for a full merits appeal from the Tribunal. Nor is such an appeal afforded by any other law. The appellants' application to the Federal Magistrates Court invoked the jurisdiction of that Court pursuant to s 39B of the Judiciary Act 1903 (Cth) ("the Judiciary Act")43. As appears from that section, it is designed to provide a statutory basis, relevantly, for "defining the jurisdiction of any federal court other than the High 40 [2005] FCA 1761 at [3]-[5]. 41 [2005] FCA 1761 at [7]. 42 [2005] FCA 1761 at [9]. 43 The jurisdiction of the Federal Magistrates Court arises under s 39B(1EA)(a) and s 39B(1EA)(d)(ii). Kirby Court" with respect to "any of the matters mentioned" in s 75 of the Constitution44. By s 75(v), the Constitution confers on this Court original jurisdiction in all matters "in which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth"45. In the present matter, the appellants sought relief of the defined type directed to the Tribunal. It was the second respondent below, as in this Court. Because the Tribunal ordinarily submits to the orders of the courts, the Minister was named as the contesting respondent. The identity of the relief provided in the Constitution for the original jurisdiction of this Court, and in s 39B of the Judiciary Act in respect of the jurisdiction of the Federal Magistrates Court and the Federal Court, indicates that the character and scope of the relief provided by that Act is, in material respects, the same as the relief provided for in the Constitution46. Thus, in determining the jurisdiction and powers of the Federal Magistrates Court (and on appeal, where error is shown, of the Federal Court) it is appropriate to start with an understanding of these remedies in Australian constitutional law. Constitutional writs are discretionary: In Re Refugee Tribunal; Ex parte Aala47, this Court settled a number of important points concerning the remedies referred to in s 75(v) of the Constitution (and, hence, in s 39B of the Judiciary Act). Relevantly, for present purposes, the Court concluded that whatever may have been the features of the named remedies in the pre-existing English and colonial "prerogative writs", the remedies were, in the Australian context, uniformly discretionary in nature48. Out of recognition of the public and federal character of the remedies, this Court has ceased describing them (as it earlier did) 44 Constitution, s 77(i). See also s 75(v). 45 Note also Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 81 ALJR 905 at 916 [61]-[64]; 234 ALR 114 at 127. 46 Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168 at 181 per Mason CJ. See also the comment of Gummow J in SAAP (2005) 79 ALJR 1009 at 1027 [91] fn 68; 215 ALR 162 at 185-186. 47 (2000) 204 CLR 82. 48 Aala (2000) 204 CLR 82 at 89 [5], 107 [54], 122 [104], 136 [146], 144 [172], 156 Kirby as "prerogative writs". It has substituted the appellation of "constitutional writs"49. When this point of distinction, derived from the specific Australian source of these remedies and their purpose is appreciated, it is no longer necessary to treat the remedies provided in s 75(v) (or their statutory derivatives in s 39B of the Judiciary Act) as subject to the same disparate procedural features as had grown up during their long history in England, having no relevance to their essential constitutional and public law functions in Australia. That, I believe, is the reason that lay behind the decision in Aala to recognise that all of the remedies so provided are discretionary. They are available to the courts as the justice of the particular case requires. Of course, what is enlivened in each case is a judicial discretion. Many of the considerations taken into account earlier in the case of the prerogative writs remain pertinent. However, the universal discretionary character of the constitutional and statutory remedies is now settled. Where a party establishes prima facie grounds for the issue of such remedies, the resisting party may point to any considerations that will nevertheless warrant the ultimate refusal of relief in the particular circumstances of the case. In Aala, drawing on the earlier case law, various explanations were afforded by members of this Court as to the circumstances that could warrant refusal of relief, although a party has otherwise established a foundation for it, as a matter of law. Thus, in their joint reasons in Aala, Gaudron and Gummow JJ "It is one thing to refuse relief on the ground of utility because, as Lord Wilberforce put it, '[t]he court does not act in vain'51. For example, the application for an administrative determination may be one which, irrespective of any question of procedural fairness or individual merits, the decision-maker was bound by the governing statute to refuse52. Or the prosecutor's complaint may be the refusal by the decision-maker of an opportunity to make submissions on a point of law which must clearly 49 See Bodruddaza (2007) 81 ALJR 905 at 911-912 [37]; 234 ALR 114 at 121; Aala (2000) 204 CLR 82 at 136 [145]. 50 (2000) 204 CLR 82 at 109 [58]. 51 Malloch v Aberdeen Corporation [1971] 1 WLR 1578 at 1595; [1971] 2 All ER 52 Mobil Oil Canada Ltd v Canada-Newfoundland Offshore Petroleum Board [1994] 1 SCR 202 at 228; Wade and Forsyth, Administrative Law, 7th ed (1994) at 528. Kirby have been answered unfavourably to the prosecutor53. Again, the decision under review may have no legal effect and no continuing legal consequences may flow from it. In such a situation, the reasoning in Ainsworth v Criminal Justice Commission54, where the remedy refused was certiorari, indicates that prohibition will not lie55." In his reasons in Aala, McHugh J wrote to similar effect56: "Not every breach of the rules of natural justice affects the making of a decision. The decision-maker may have entirely upheld the case for the party adversely affected by the breach; or the decision may have turned on an issue different from that which gave rise to the breach of natural justice. Breach of the rules of natural justice, therefore, does not automatically invalidate a decision adverse to the party affected by the breach. This principle was acknowledged by this Court in Stead v State Government Insurance Commission57 when it said that 'not every departure from the rules of natural justice at a trial will entitle the aggrieved party to a new trial'. Nevertheless, once a breach of natural justice is proved, a court should refuse relief only when it is confident that the breach could not have affected the outcome because '[i]t is no easy task for a court … to satisfy itself that what appears on its face to have been a denial of natural justice could have had no bearing on the outcome'58." In my own reasons in Aala I indicated that the "public character of the legal duties" which the remedies were designed to uphold meant that "ordinarily, [relief] will issue where the preconditions are made out"59. I went on to acknowledge60: 53 See Stead v State Government Insurance Commission (1986) 161 CLR 141 at 145. 54 (1992) 175 CLR 564 at 580-581. 55 Abebe v The Commonwealth (1999) 197 CLR 510 at 553-554 [113]. 56 (2000) 204 CLR 82 at 122 [104]. 57 (1986) 161 CLR 141 at 145. 58 (1986) 161 CLR 141 at 145. 59 (2000) 204 CLR 82 at 136-137 [148]. 60 (2000) 204 CLR 82 at 136-137 [148]. Kirby "But circumstances will occasionally arise where it is appropriate to withhold the writ because a party has been slow to assert its rights, has been shown to have waived those rights, or seeks relief in trivial circumstances or for collateral motives, and where the issue of the writs would involve disproportionate inconvenience and injustice." The decision in Aala was thus a clear indication by this Court of the discretionary character of the remedies sought by the appellants in their applications for judicial review. In the result, all members of the Court upheld the existence of the discretion and two (McHugh J61 and Callinan J62, in whole or part) refused the remedies claimed. The result of Aala is that, whilst establishment of the preconditions for this form of relief will ordinarily entitle a party to the relief, there will always remain a residual discretion to be exercised judicially. Some of the considerations relevant to that decision have been identified. However, in the the facts and nature of discretionary remedies, much will depend on circumstances of the particular case. Resistance to the contention: The Minister acknowledged that, neither the Federal Magistrates Court nor the Federal Court had, in terms, rejected the appellants' proceedings on discretionary grounds. Moreover, in neither Court had the Minister urged that course. So far as the appellants had relied on s 424A, the Minister had submitted that there had been no contravention of the section and thus no occasion to consider whether remedies for default should be refused on discretionary grounds. The appellants objected to the Minister's late application to rely on a Notice of Contention raising the discretionary point. There is no merit in that opposition. The issue is not one that could have been met by any evidence below provided by the appellants63. The argument is addressed solely to the matters available in the record. Any defects in the presentation of the point below arise from the ill-focused character of the appellants' arguments, because they were not then legally represented. The propounded contention is entirely consistent with the Minister's submissions there. It was clearly foreshadowed during the special leave hearing. The Minister should therefore have leave to file his Notice of Contention and raise this discretionary argument. 61 (2000) 204 CLR 82 at 128 [122]-[123]. 62 (2000) 204 CLR 82 at 156-157 [217]-[219]. 63 cf Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438; Coulton v Holcombe (1986) 162 CLR 1 at 7-9. Kirby Arguments against relief: Assume, for the purpose of argument, that in this appeal the appellants could establish a breach by the Tribunal of the requirements of s 424A. Any such breach would depend upon establishing the preconditions envisaged by s 424A. To this extent only it is necessary to consider what s 424A, read with s 441A of the Act, provides. Section 424A assumes the existence of "information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review". The failure to comply with s 424A is said to be constituted by the failure of the Tribunal to give the appellants copies in writing of the documents allegedly inconsistent with the male appellant's oral evidence, that being the method prescribed for giving such documents to a person64. Might any such failure have affected the correct disposal of the appellants' application to the Tribunal? If it might, the matter would not be suitable for dismissal in the exercise of a judicial discretion. The Minister submitted that in this matter such a failure, based on s 424A, even if established, could not have affected the Tribunal's decision. This was because that decision rested on a reason insusceptible to alteration by any response which the appellants might have made to the posited information, had it been given to them as s 424A envisaged. The Tribunal's decision depended upon its conclusion that the character of the dispute which the appellants had described with the male appellant's former wife's family in India was a private dispute about private animosities. Thus, even if those animosities had given rise to "fear", including the fear of being wrongly and corruptly prosecuted and imprisoned for criminal offences, this did not amount to persecution. Still less to "being persecuted for reasons of … religion … [or] membership of a particular social group". The words "for reasons of" require the characterisation of what had occurred, as does the necessity of establishing persecution. In short, the characterisation, by the delegate and relevantly by the Tribunal, concluded that the "reasons" were private inter-familial hostility. They lacked the character necessary to bring them within the Convention grounds. Once the Tribunal so decided, the Act required65 the protection visas sought by the appellants to be refused. The appellants could not satisfy the criteria for the grant of protection visas66. The formation of that conclusion 64 SAAP (2005) 79 ALJR 1009 at 1020 [48]-[51], 1040 [175]-[176], 1043-1044 [192]-[196]; 215 ALR 162 at 175, 203-204, 207-208. See also joint reasons at 65 The Act, s 65. 66 The Act, s 36(2)(a). Kirby concerning the character of the "reasons" would be unimpeached by any contravention that the appellants might be able to demonstrate concerning the requirements of s 424A. It stood alone, and sufficient in itself, to sustain the decision of the Tribunal, effectively confirming the decision of the delegate based, ultimately, on the same reason. As the reasons of the Tribunal show, the member did call to the male appellant's attention the suggested disparity between his oral evidence and earlier written "information": "I asked the [male appellant] whether he could explain the discrepancies between his written claims and that of his oral evidence as to the dates of his arrests. The [male appellant] responded that his memory was not good. He added that a person did not want to remember bad things. He also asked the tribunal whether there was much difference. He added that he did not believe that it was important when things occurred rather that they had occurred. After his wife gave oral evidence it was put to the [male appellant] that his written statement and his wife had indicated that the last arrest occurred in December 2001. The [male appellant] again explained the discrepancy by stating that his memory was very bad." In the light of this oral identification of the "information" derived from the appellants themselves, any infraction of s 424A is effectively reduced to a complaint of a failure of the Tribunal to provide the "information" concerned to the appellants in written form with an invitation to comment on it67. No such requirement or formality would exist as part of the general law of natural justice and procedural fairness. However, allowing for the Parliament's provision for such a requirement68, the fact remains that any comment by the appellants on these particular matters could not possibly have altered the Tribunal's characterisation of the "reasons" for the appellants' propounded fear of persecution. Any breach of s 424A might be relevant to the general credibility of the male appellant. However, the Tribunal's "reason" for affirming the decision of the delegate was more basic. It was a "conclusion" about the "reasons" for the propounded fear of persecution on the part of the appellants. And that conclusion was that the source of any "fear" was private and for domestic 67 See joint reasons at [12], [15]. 68 The Act, ss 424A, 441A. See SAAP (2005) 79 ALJR 1009 at 1040 [175]; 215 ALR Kirby reasons. It was not for reasons that would enliven the protection obligations imposed on Australia as a State party to the Convention. Suggested inconsistency with SAAP: Is this conclusion inconsistent with the reasoning of the majority of this Court in SAAP? I was part of that majority and I do not consider that there is an inconsistency. All members of the majority in SAAP acknowledged the residual availability of a discretionary decision to decline relief69. However, in the circumstances of SAAP, all members of the majority concluded that relief should not be denied in the exercise of that residual discretion. The circumstances of SAAP and of the present case are very different. In SAAP, the applicants before the Tribunal were a mother and young daughter. The mother was illiterate. The mother and daughter were detained in immigration detention at Woomera. The mother had an older daughter, living in Sydney, who gave information to the Tribunal, in the mother's absence, in some ways adverse to her claim70. The case was a clear example of the circumstances in which the provision of information in writing was required71. It might have affected the outcome because that information was critically addressed to what "would be the reason, or a part of the reason, for affirming the decision that is under review"72. That is not the present case. Here, in so far as the procedures adopted by the Tribunal are concerned, the substance of the "information" before the Tribunal was drawn to the appellants' notice orally73. More fundamentally however, the "information" was not addressed to "the reason, or a part of the reason" for the Tribunal's decision74. When properly analysed, that "reason" was the conclusion of the Tribunal about the character of the conflict involving the male appellant and his former wife's family and the "reasons", within the language of the Convention, for any "fear of persecution" which the appellants 69 (2005) 79 ALJR 1009 at 1026-1027 [79]-[84] per McHugh J; 1046 [210]-[211] per Hayne J and 1040 [174]-[176] of my own reasons; 215 ALR 162 at 183-185, 70 See SAAP (2005) 79 ALJR 1009 at 1016-1018 [31]-[37]; 215 ALR 162 at 170-172. 71 See SAAP (2005) 79 ALJR 1009 at 1035-1036 [144], 1040 [175]; 215 ALR 162 at 72 The Act, s 424A(1)(a). 73 cf SAAP (2005) 79 ALJR 1009 at 1040 [175]; 215 ALR 162 at 203. 74 cf joint reasons at [15], [17]. Kirby had deterring them from availing themselves of the protection of the country of their nationality, India. Whereas in SAAP, it was my opinion that "discretionary considerations overwhelmingly [favoured] the provision of relief"75, in the present appeal, they overwhelmingly favour the refusal of relief. They do so because here any non-compliance with s 424A was immaterial to the "reason" of the Tribunal for its decision adverse to the appellants which I have identified. Invalidity and discretion: The appellants submitted that this conclusion was inconsistent with some of the majority reasoning in SAAP, which the Minister (despite a few hints from the Bench) declined to challenge and accepted as correctly stating the law on s 424A76. It is true that in the reasons of McHugh J77 and of Hayne J78 in SAAP, emphasis was placed on the invalidity of a decision made following a breach of the requirements of s 424A and the relevance of such invalidity to the availability of certiorari to quash "what is found to be an invalid decision"79. However, neither McHugh J nor Hayne J questioned the principle established by this Court in Aala, that relief of the kind described in s 75(v) of the Constitution (and reflected in s 39B of the Judiciary Act) is fundamentally discretionary in nature. Nor, in my reasons, did I. Moreover, McHugh J expressly acknowledged that in some circumstances ("suggestion of delay, waiver, acquiescence or unclean hands"80) relief might be withheld on discretionary grounds. It will often (perhaps usually) be the case that the remedies for which s 75(v) of the Constitution (and s 39B of the Judiciary Act) provide are enlivened by instances of established jurisdictional error. Yet to acknowledge the existence of a discretion to withhold relief is to accept that, in some instances, although invalidity is established, the circumstances do not call for the provision of judicial remedies. 75 (2005) 79 ALJR 1009 at 1040 [176]; 215 ALR 162 at 204. 76 Joint reasons at [2]. 77 (2005) 79 ALJR 1009 at 1027 [83]-[84]; 215 ALR 162 at 184-185. 78 (2005) 79 ALJR 1009 at 1046 [211]; 215 ALR 162 at 212. 79 (2005) 79 ALJR 1009 at 1046 [211]; 215 ALR 162 at 212. 80 (2005) 79 ALJR 1009 at 1027 [84]; 215 ALR 162 at 185. Kirby In a sense, this conclusion simply acknowledges the great variety of cases and circumstances that come before the courts; the different kinds of infraction that are said to warrant relief; the different positions of the parties; and the need to conserve relief to cases where it is appropriate and required to do practical justice. Sometimes the reasons for denying relief may have their origins in defaults and omissions on the part of the claimant ("because a party has been slow to assert its rights, has been shown to have waived those rights"81, or otherwise). Sometimes, relief may be denied because the error relied upon is immaterial to the reasoning of the decision-maker. Instances of immateriality of this kind were identified by Gaudron and Gummow JJ in Aala82. The present appeal affords another, and different, instance. Reason or part of the reason: The appellants asked rhetorically, in effect, how it could be said that the alleged disparity between the oral evidence given by the male appellant and the earlier written documentation was not "the reason, or a part of the reason, for affirming the decision that is under review" when the Tribunal had expressly referred to that subject in the reasons for its decision. Not everything that is said in the course of the reasons of a tribunal or a court, when analysed, constitutes "the reason, or a part of the reason" for the resulting dispositive order. To find that "reason" requires more than pointing to the discursive reasoning of the decision-maker. It requires analysis, a fact made clear by the use in s 424A of the conditional tense ("would be") – a formulation that necessitates a hypothetical construct83. In countries of the common law tradition, such as Australia, the reasoning of courts and tribunals is typically (as in this case) detailed and elaborate and includes material that is not strictly necessary to the ultimate decision. This mode of reasoning contrasts with that typical of courts and tribunals in most civil law countries, although the two systems have lately moved somewhat towards each other. Finding what would be "the reason" or "a part of the reason" for a "decision" of a tribunal requires identification of the links in the chain that sustain (if they do) the eventual disposition. Many reasons of courts and tribunals contain discussion of matters that are not part of this process of reasoning84. Thus, they may include a more detailed 81 Aala (2000) 204 CLR 82 at 136-137 [148]. 82 (2000) 204 CLR 82 at 109 [58]. 83 See also joint reasons at [17]. 84 SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 150 FCR 214 at 262 [216] per Allsop J, Weinberg J concurring at 242 [94]; (Footnote continues on next page) Kirby account of the facts, as recounted by the witnesses, than is strictly necessary. They may contain a description of the submissions of the parties although ultimately some or most of these may be treated as superfluous, irrelevant or insignificant to the decision. They may refer to legislation and case law that is not, in the end, determinative. They may set out impressions of witnesses, although such impressions do not eventually control, or even influence, the decision. It is pointless to complain about these features of discursive reasoning. They are well entrenched. In part, they derive from tradition; pressures imposed on decision-makers to complete their reasons quickly; the premium normally attached to candour and disclosure of the consideration of evidence and argument in reasoning; and the fact that the process of explaining decisions sometimes clarifies, in the mind of the decision-maker, those elements that are (or would be) "the reason, or a part of the reason" for the decision, thereby distinguishing them from those that are not (or would not be) such. The appellants submitted that the alleged discrepancies between earlier written documents and their oral evidence before the Tribunal had influenced the Tribunal's assessment of their credit. In this sense, they argued, the discrepancy would at least be "a part of the reason" for the Tribunal's ultimate decision. In many cases, including claims to refugee status, this would undoubtedly be so. Thus, if the Tribunal were to disbelieve that a refugee applicant was an apostate convert to Christianity85 or a homosexual86 or the victim of domestic violence87 and this was the basis of the propounded fear of persecution, obviously a reference to evidence relevant to the applicant's credit would be "the reason, or a part of the reason" for the Tribunal's decision. In that event, as in SAAP, the requirements of s 424A would necessitate provision of the information in question and in the form specified in the section88. cf SZDQL v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 144 FCR 356 at 365-367 [55]-[59]; VAF v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 206 ALR 471 at 478 [33]. 85 Applicant NABD of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 79 ALJR 1142; 216 ALR 1. 86 Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 216 CLR 473. 87 Minister for Immigration and Multicultural Affairs v Khawar (2002) 210 CLR 1. 88 See the Act, s 424A(2)(a); SAAP (2005) 79 ALJR 1009 at 1027 [83]-[84]; 215 ALR 162 at 184-185. Kirby The correct analysis: However, that is not this case. Here, after elaborating all of the descriptive material, recounting the ways in which the appellants put their case, describing the country information, recording impressions of witnesses and so forth, the Tribunal, in effect, cut to the chase. Essentially, it said: Be that all as it may, and accepting the claim as stated in full, it still lacks the essential nexus to a Convention ground. It is a private dispute. As such, it does not attract the country obligations imposed by the Convention. Properly analysed, that was "the reason" and the only "reason" in this case for the Tribunal's decision. It was sufficient. And it necessarily required rejection of the appellants' claims. It could not possibly have been affected by anything that might have been said by either of the appellants in response to written copies of documentation addressed only to preliminary, collateral and discursive matters as set forth in the Tribunal's reasons. Whilst I agree that the phrase "the reason, or a part of the reason" should not be narrowly read so as to diminish the obligations of s 424A (SAAP stands against such a narrow reading), the search is not simply for a passage in the Tribunal's discussion. It is for the identification of something more substantive. Just as the elucidation of the ratio decidendi of a decision for legal purposes requires analysis89, "the reason, or a part of the reason" referred to in s 424A(1)(a) also requires discernment and correct analysis. In both cases, it is a mistake to treat everything this is, or might be, contained in the discursive reasoning as significant for the more precise legal purpose in hand. Conclusion and order Once the foregoing conclusion became clear, it was immaterial for the Federal Magistrates Court or the Federal Court to examine the extent of the default of the Tribunal, if any, under s 424A or to elaborate further the meaning of that provision. Any such default could not have affected the decision of the Tribunal for the reason that it accepted. An application for judicial review of that to dismissal on discretionary grounds90. decision was Discretionary refusal of judicial review must be exercised with care, particularly where the hypothesis of jurisdictional error is a possibility. However, in some such cases (of which this was one) invocation of the discretion is proper, prudent, economical and just. therefore liable In effect, the discretion allows the reviewing court to say: The case is clear. A sound basis for the challenged decision has been established. Even if a postulated error has occurred in complying with s 424A and could be proved, any 89 See eg Garcia v National Australia Bank Ltd (1998) 194 CLR 395 at 417-418 [56]. 90 See also reasons of Hayne J at [91]-[92]. Kirby such error is immaterial because it could not undermine the essential legal basis that sustains the decision. In that event, to divert the court's time and resources into examining a supposed technical breach is not a proper use of its energies. Nor is it required by the justice of the case. When such conclusions are reached, the reviewing court is entitled to, and should, reject the application in the exercise of its discretion. It should leave analysis of suggested technical infractions to a case where the result of such analysis might influence the outcome. This was not such a case. Upon this discretionary ground, and not for any view of the compliance or non-compliance with s 424A of the Act, I would dismiss the appeal with costs. HAYNE J. I agree that the appeal should be dismissed with costs. The Refugee Review Tribunal's finding that the appellants' claims lacked the requisite nexus with the Convention91 was inevitable. That being so, the appellants were not entitled to relief of the kind they sought. The discretion92 to grant that relief was to be exercised against them. There is, therefore, no occasion to consider the application in this case of s 424A of the Migration Act 1958 (Cth) or to consider what was said about that provision in SAAP v Minister for Immigration and Multicultural and Indigenous Affairs93. Nor is it necessary to examine what has been said about that provision by the Full Court of the Federal Court of Australia in Minister for Immigration and Multicultural Affairs v Al Shamry94 or SZEEU v Minister for Immigration and Multicultural and Indigenous Affairs95. 91 Convention Relating to the Status of Refugees done at Geneva on 28 July 1951 (1954 ATS 5), as amended by the Protocol Relating to the Status of Refugees done at New York on 31 January 1967 (1973 ATS 37). 92 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82. 93 (2005) 79 ALJR 1009; 215 ALR 162. 94 (2001) 110 FCR 27. 95 (2006) 150 FCR 214. Hayne

HIGH COURT OF AUSTRALIA TTY167 AND APPELLANT REPUBLIC OF NAURU RESPONDENT TTY167 v Republic of Nauru [2018] HCA 61 5 December 2018 ORDER The time fixed for the filing of the notice of appeal is enlarged to 12 March 2018. Appeal allowed. Set aside the orders made by the Supreme Court of Nauru on 20 February 2018 and, in their place, order that: the decision of the Refugee Status Review Tribunal dated 3 July 2016 be quashed; and the matter be remitted to the Refugee Status Review Tribunal for reconsideration according to law. The respondent pay the appellant's costs of this appeal. On appeal from the Supreme Court of Nauru Representation W G Gilbert SC with M L L Albert and J A Barrington for the appellant (instructed by Clothier Anderson Immigration Lawyers) G R Kennett SC with P M Knowles for the respondent (instructed by Republic of Nauru) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS TTY167 v Republic of Nauru Immigration – Refugees – Nauru – Appeal as of right from Supreme Court of Nauru – Where Secretary of Department of Justice and Border Control determined appellant not refugee and not owed complementary protection – Where appellant applied to Refugee Status Review Tribunal for merits review of Secretary's determination – Where Tribunal sent letter to "Team Leader" of claims assistance provider inviting appellant to attend hearing – Where appellant and his representatives failed to attend Tribunal hearing – Where Tribunal affirmed Secretary's determination in appellant's absence – Where Supreme Court affirmed Tribunal's decision – Whether invitation to attend Tribunal hearing given to appellant – Whether legally unreasonable for Tribunal to decide matter without taking further action to allow or enable appellant to appear. Words and phrases – "authorised representative", "given", "invitation to appear", "jurisdictional requirement", "legally unreasonable". Interpretation Act 2011 (Nr), ss 100, 101. Refugees Convention Act 2012 (Nr), ss 40(3), 41(1). GAGELER, NETTLE AND EDELMAN JJ. Introduction This appeal is from a decision of the Supreme Court of Nauru. The appeal was brought six days out of time but the notice of appeal was filed prior to the termination of the Agreement between the Government of Australia and the Government of the Republic of Nauru relating to appeals to the High Court of Australia from the Supreme Court of Nauru. An extension of time in which to file the notice of appeal was not opposed. The extension should be granted. For the reasons given in The Republic of Nauru v WET0401, this Court has jurisdiction to hear the appeal. The Supreme Court of Nauru upheld a decision of the Refugee Status Review Tribunal ("the Tribunal"), which had concluded that the appellant was neither a refugee nor owed complementary protection. There are two grounds of appeal in this Court. The first concerns whether an invitation to appear before the Tribunal was given to the appellant and, if not, whether that failure meant that the Tribunal had no jurisdiction. The second concerns whether it was legally unreasonable for the Tribunal not to adjourn the hearing when neither the appellant nor his lawyers attended. For the reasons below, the first ground of appeal should be dismissed. In summary, the Tribunal's jurisdiction required that an invitation be given to the appellant to attend the hearing. That invitation could have been given to the appellant or to his authorised representative. Since this ground of appeal was not raised in the Supreme Court, it is not possible to know whether the person to whom the Tribunal gave the invitation was the authorised representative of the appellant. It is too late to raise this point on appeal to this Court. However, the appeal should be allowed on the second ground. The failure by the Tribunal to adjourn the hearing was legally unreasonable in the exceptional circumstances of this case, where: (i) the appellant and his lawyers had informed the Tribunal that the appellant had mental health issues, which should have raised a reasonable apprehension that the appellant did not attend for health reasons; (ii) the absence of the appellant and his lawyers from the hearing was surprising because the appellant had been strongly engaged with his application, he had informed the Tribunal that he would attend and his lawyers had informed the Tribunal only two days before the hearing of their expectation that he would attend; (iii) the personal attendance of the appellant was a matter of [2018] HCA 56. Nettle Edelman considerable importance to the appellant and was important for matters about which the Tribunal was concerned; and (iv) it would have been easy for the Tribunal to contact the appellant's lawyers. Background The appellant is a citizen of Bangladesh. On 20 September 2014, he applied to the Secretary of the Department of Justice and Border Control ("the Secretary") to be recognised as a refugee, or a person owed complementary protection, under s 6 of the Refugees Convention Act 2012 (Nr). The appellant was assisted in preparing his application by a representative of a Nauru claims assistance provider called CAPS. In the statement attached to his application he explained that the standard of education in Bangladesh was poor, and that he was illiterate and struggled even to write his own name. On the day of the appellant's scheduled refugee status determination ("RSD") interview, a representative of CAPS sent an email to the RSD officer explaining that the appellant was unwell but was "eager to attend" an interview. The interview was rescheduled to and took place on 20 October 2014. The appellant claimed that he had been a member of the student wing of the Jamaat-e-Islami ("JeI") political party, and that his father was a local JeI leader. He said that after the Awami League formed government in 2009 they had begun oppressing the supporters of JeI. He claimed that his home had been raided and vandalised by members of the Awami League, and that his mother and siblings had been beaten. He said that he had amended his religious practices to avoid identification as a JeI supporter, but that he had attended a protest in 2013 at which he and his father were beaten, and his brother went missing and is feared to have been killed. On 9 October 2015, the Secretary refused the application. The Secretary did not accept that the appellant was anything more than a low-level supporter of JeI, or that the appellant had any profile that would have been of interest to the Awami League. He did not accept that the appellant's father was in a leadership position or a position of influence in JeI. He did not accept the appellant's evidence about the alleged raid on his home. Nor did the Secretary accept that the appellant had taken part in the protest. On 17 December 2015, two days after being notified of the Secretary's determination, the appellant applied to the Tribunal under s 31 of the Refugees Convention Act for merits review of the Secretary's determination. On 15 April 2016, the Tribunal invited the appellant to appear before it. The invitation letter was not addressed to the appellant. It was addressed to a Nettle Edelman woman described as a "Team Leader" at CAPS. The letter informed the Team Leader of the appellant's application to the Tribunal as well as the date and time of the hearing. She was asked to inform the Tribunal in writing of any person from whom the appellant would like the Tribunal to take oral evidence. The letter concluded by informing her that, if the appellant did not appear before the Tribunal on the date and at the time specified, "the Tribunal may make a decision on the review without taking further action to allow the [appellant] to appear". On 20 April 2016, the appellant provided a statement to the Tribunal. He explained that the information was only a summary of his response to the Secretary's determination. He said that he would "provide further information in relation to my protection claims during my hearing". He also explained that his mental health had been affected by his fear of returning to Bangladesh and his detention for nearly three years. He described symptoms of deteriorating memory, anxiety and depression, weakness, confusion, and dizziness. On 4 May 2016, the appellant's lawyers sent the Tribunal a 39-page submission in support of the appellant's application. The lawyers referred to the matters upon which the Secretary had disbelieved the appellant but pointed out the absence of any discussion or conclusions concerning seven other material matters that supported the appellant's application. In response to the adverse credibility findings against the appellant, his lawyers said that it was "reasonable for our client to take his next available opportunity, before the Tribunal, to provide all the information he has in support of his claims for protection". The lawyers also reiterated the deteriorating state of the appellant's physical and mental health, including his depression and anxiety. On 6 May 2016, the appellant failed to attend the scheduled hearing. The Tribunal's reasons contain no mention of any attendance by any lawyer representing the appellant, or any representative of CAPS, who had assisted the appellant with preparing his application and to whom the appellant's invitation to attend had been directed. The natural inference from the Tribunal's reasons is that there was no attendance by any representative of the appellant at the hearing, nor any communication from either the appellant or any representative of him before the Tribunal gave its reasons on 3 July 2016. The Tribunal affirmed the determination of the Secretary. The Tribunal observed that the appellant's failure to attend the hearing prevented it from exploring many aspects of his claims that were described by the Tribunal as "lacking in details and ... unsupported by other evidence". The Tribunal also referred to particular information that it would "have liked to clarify with the [appellant]" such as when he joined a political party and what his father's role and his role were with the party after they moved to a different district. Nettle Edelman The appellant appealed from the decision of the Tribunal to the Supreme Court. He was unrepresented. He had two grounds of appeal. In essence, his first ground was that he had been denied procedural fairness by the Tribunal's failure to adjourn the hearing. He claimed that he had instructed his lawyers to seek an adjournment. His second ground of appeal alleged that the decision of the Tribunal was unreasonable and that the Tribunal was biased against him. The Supreme Court dismissed the appeal on both grounds. In relation to the first ground, which is the only ground relevant to the appeal to this Court, the Court held that it was open to the Tribunal to make a decision without taking further action to enable the appellant to appear. The Court referred to the absence of any request for an adjournment from the appellant at any time before the Tribunal's decision, and the absence of any expert medical evidence before the Tribunal explaining why it was not possible for the appellant to attend the hearing2. Whether the invitation was given to the appellant The first ground of appeal to this Court alleges that the Supreme Court should have quashed the Tribunal's decision because the appellant was not given an invitation to appear before the Tribunal. This issue was not raised before the Supreme Court. Sections 40 and 41 of the Refugees Convention Act provide relevantly as follows: "40 Tribunal must invite applicant to appear (3) An invitation to appear before the Tribunal must be given to the applicant with reasonable notice and must: specify the time, date and place at which the applicant is scheduled to appear; and invite the applicant to specify, by written notice to the Tribunal given within 7 days, persons from whom the applicant would like the Tribunal to obtain oral evidence. 2 TTY 167 v The Republic [2018] NRSC 4 at [31], [33]. Nettle Edelman Failure of applicant to appear before Tribunal If the applicant: is invited to appear before the Tribunal; and does not appear before the Tribunal on the day on which, or at the time and place at which, the applicant is scheduled to appear; the Tribunal may make a decision on the review without taking further action to allow or enable the applicant to appear before it." The two conditions in s 41(1) are jurisdictional requirements for the exercise of the power by the Tribunal to make a decision on the review without taking further action to allow or enable an applicant to appear before it. The first, an invitation to appear, is plainly a reference to the requirements of s 40, including the requirements in s 40(3). Section 101 in Pt 9, Div 4 of the Interpretation Act 2011 (Nr) provides for service of a document on an individual in a number of ways. These include "giving it to: (i) the individual; or (ii) a person authorised by the individual to receive the document". Section 100 of the Interpretation Act provides that Div 4 applies to "a document that is authorised or required under a written law to be served, whether the word 'serve', 'give', 'notify', 'send', 'tell' or any other word is used". The effect of ss 100 and 101 of the Interpretation Act is that the jurisdictional requirement in s 40(3) of the Refugees Convention Act, that an invitation to appear before the Tribunal be "given" to the applicant, can be satisfied by giving the document to a person authorised by the applicant to receive it. However, since this issue was not raised before the Supreme Court, there is no evidence before this Court concerning whether the Team Leader at CAPS, to whom the letter inviting the appellant to appear before the Tribunal was addressed, had been authorised by the appellant to receive the invitation. That evidence could have been an answer to this ground of appeal. Its absence below means that the issue cannot be raised on appeal to this Court3. This ground of appeal must be dismissed. 3 Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438; [1950] HCA 35; Coulton v Holcombe (1986) 162 CLR 1 at 7-8; [1986] HCA 33. Nettle Edelman Unreasonableness The second ground of appeal to this Court alleges that the Tribunal acted unreasonably in exercising its powers under s 41(1) of the Refugees Convention Act to decide the matter without taking further action to allow or enable the appellant to appear before it. It was not in dispute that the standard of legal unreasonableness implied as a condition of exercise of the power in the Refugees Convention Act is a demanding standard, particularly in light of the concerns of informality and the need for efficiency that underlie Tribunal hearings4 and the wide latitude that the Tribunal has in making a decision under s 41(1) to decide the matter in an applicant's absence5. Nevertheless, there are six reasons, in combination, why the circumstances of this case were so exceptional that the decision of the Tribunal to proceed to decide the matter without making any enquiry about the appellant's absence on the date of the hearing was legally unreasonable. First, unlike the circumstances described in Minister for Immigration and Border Protection v SZVFW6, to which the parties referred, the appellant had been highly engaged with pursuing his application for protection. With assistance, he had prepared a substantial written statement in support of his application prior to the RSD interview. Although he was unwell at the time of the first scheduled RSD interview, he had attended the rescheduled RSD interview. He had provided the Tribunal with a further written statement and had instructed his lawyers to prepare substantial submissions, which they did. Secondly, the appellant's statement to the Tribunal, just over two weeks before the hearing, had indicated that he intended to attend the hearing and to provide further evidence. Further, the submissions of the appellant's lawyers, only two days before the hearing, also indicated their expectation that the appellant would take the opportunity to appear before the Tribunal. Thirdly, the appellant's oral evidence was a matter of considerable importance for the Tribunal because the appellant's claims were considered by the Tribunal to be lacking in details and unsupported by other evidence. 4 See, eg, Refugees Convention Act 2012 (Nr), ss 22, 33. 5 See Minister for Immigration and Border Protection v SZVFW (2018) 92 ALJR 713 at 731 [68]-[69], 734-735 [88]-[96], 741 [140]; 357 ALR 408 at 426, 429-431, 439; [2018] HCA 30. (2018) 92 ALJR 713; 357 ALR 408. Nettle Edelman Fourthly, the Tribunal was aware that the appellant claimed to be suffering from mental health problems. The Tribunal observed that it was unclear whether the appellant had raised his mental health issues as a reason why he may not have been able to answer questions in his RSD interview or whether he was "indicating that he would have difficulty participating in a hearing before the Tribunal". In either case, the Tribunal was aware of health issues raised by the appellant. Those health issues could reasonably have been expected to affect the ability of the appellant to attend the hearing on the scheduled date. Fifthly, although the invitation from the Tribunal warned that "the Tribunal may make a decision on the review without taking further action to allow the [appellant] to appear", and although the Tribunal could reasonably have assumed that the contents of the invitation had been communicated to the appellant, the Tribunal, which knew of the appellant's illiteracy and limited understanding of English, could not reasonably have inferred that the appellant had made an informed decision not to attend the hearing. Sixthly, it would have been a simple matter for the Tribunal to have contacted either the appellant's lawyers or persons at CAPS who the Tribunal would reasonably have been aware were assisting the appellant. Senior counsel for the respondent properly accepted that this Court could take judicial notice of the fact that Nauru is a small island. He also accepted that it would usually be easy to contact the appellant's lawyers at reasonably short notice. The Tribunal did not do so. Conclusion The appeal should be allowed. Orders should be made as follows: The time fixed for the filing of the notice of appeal is enlarged to 12 March 2018. Appeal allowed. Set aside the orders made by the Supreme Court of Nauru on 20 February 2018 and, in their place, order that: the decision of the Refugee Status Review Tribunal dated 3 July 2016 be quashed; and the matter be remitted to the Refugee Status Review Tribunal for reconsideration according to law. The respondent pay the appellant's costs of this appeal.

HIGH COURT OF AUSTRALIA APOTEX PTY LTD APPLICANT/APPELLANT AND SANOFI-AVENTIS AUSTRALIA PTY LTD & ORS RESPONDENTS Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd [2013] HCA 50 4 December 2013 S219/2012 & S1/2013 ORDER Matter No S1 of 2013 Appeal dismissed with costs. Matter No S219 of 2012 Special leave to appeal on ground 3 of the Draft Notice of Appeal filed on 10 September 2012 granted. Appeal allowed with costs. Set aside the orders of the Full Court of the Federal Court of Australia made on 18 July 2012 and, in their place, order that: the appeal be allowed in part; orders 2, 3 and 6 of the Federal Court made on 18 November 2011 be set aside; order 1 of the Federal Court made on 24 February 2012 be set aside; and so much of the Amended Application dated 22 September 2009 as made in paragraphs 14 to 22 be dismissed. Remit the matter to the Full Court on the questions of the costs of the appeal to that Court and the costs of the trial (which latter question may, at the discretion of the Full Court, be remitted to the primary judge). On appeal from the Federal Court of Australia Representation D K Catterns QC with N R Murray for the applicant/appellant (instructed D F Jackson QC with C Dimitriadis for the respondents (instructed by Jones Day) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd Intellectual property – Patents – Patent claimed administration of pharmaceutical substance as method of preventing or treating medical condition – Whether method of medical treatment of human body is patentable invention within meaning of s 18(1)(a) of Patents Act 1990 (Cth) – Whether product or process is manner of manufacture within meaning of s 6 of Statute of Monopolies – Whether novel therapeutic use of known substance is patentable invention. Intellectual property – Patents – Infringement – Construction of claim – Patent claimed use of pharmaceutical substance for preventing or treating medical condition – Whether person who supplies drug and indicates use for treatment of different condition infringes patent under s 117(1) of Patents Act 1990 (Cth). Words and phrases – "manner of manufacture", "patentable invention". Patents Act 1990 (Cth), ss 13(1), 18(1)(a), 18(2), 117(1), 119A, 138(3)(b), Sched 1. Statute of Monopolies 1623 (21 Jac I c 3), s 6. Therapeutic Goods Act 1989 (Cth), s 16(1). Introduction The primary question in this case is whether methods of medical treatment of human beings, including surgery and the administration of therapeutic drugs, can be the subject of patents. This Court has not had to decide the question until now. For the reasons that follow, in particular so that the law may be logically coherent, the question ought to be answered in the affirmative. The appellant, Apotex Pty Ltd ("Apotex"), which was sued by the respondents for infringement of their patent for a method of using a known drug to prevent or treat psoriasis, therefore fails in its challenge to the validity of the patent. However, for the reasons given by Crennan and Kiefel JJ1, Apotex's application for special leave to appeal against the finding in the Federal Court that it infringed the patent should be granted and its appeal on that matter allowed. Factual and procedural history It is sufficient to outline briefly salient features of the factual and procedural history, which are dealt with in more detail in the judgment of Hayne J2 and the joint judgment of Crennan and Kiefel JJ3. The drug Leflunomide, the preparation and composition of which were the subject of an expired Australian patent4, is used for the treatment of psoriatic and rheumatoid arthritis. A method of using Leflunomide is the subject of a current Australian Patent No 670491 entitled "Pharmaceutical for the treatment of skin disorders" ("the Patent"). The Patent has a priority date of 31 March 1993 and expires on 29 March 2014. It has a single claim: "A method of preventing or treating a skin disorder, wherein the skin disorder is psoriasis, which comprises administering to a recipient an effective amount of a pharmaceutical composition containing as an active ingredient a compound of the formula I or II". 1 Reasons of Crennan and Kiefel JJ at [293]–[305]. 2 Reasons of Hayne J at [59]–[67]. 3 Reasons of Crennan and Kiefel JJ at [178]–[185], [205]–[214]. 4 Australian Patent No 529341 claimed a chemical formula of Leflunomide, a process for its preparation, a composition containing the compound as an active ingredient and a method claim. That patent expired in 2004. The formulae are then set out. A compound of the formula I is Leflunomide. The validity of the Patent is in issue in this appeal. Apotex contends that it relates to a method of medical treatment and cannot be a patentable invention under the Patents Act 1990 (Cth) ("1990 Act"). In the alternative, Apotex contends that the claim in the Patent is for a second or subsequent medical use of a previously known product involving the purpose of its use as an element and that on that ground, it does not disclose a patentable invention. The second respondent, Sanofi-Aventis Deutschland GmbH, is the registered owner of the Patent. The first respondent, Sanofi-Aventis Australia Pty Ltd, supplies Leflunomide in Australia under the trade names "Arava" and "Arabloc". Apotex obtained registration of generic versions of Leflunomide (collectively, "Apotex Leflunomide Products") on the Australian Register of Therapeutic Goods in or about July 2008. Its intention was to supply the products and offer them for supply in Australia as treatments for psoriatic arthritis and rheumatoid arthritis. The respondents initiated proceedings against Apotex in the Federal Court of Australia on 23 October 20085. They alleged that Apotex's proposed supply of the Apotex Leflunomide Products for the treatment of psoriatic arthritis would infringe the Patent. Other causes of action not material to this appeal were also asserted. In support of their infringement claim, the respondents alleged, inter alia: Apotex intended to supply and offered to supply in Australia the Apotex Leflunomide Products for the treatment of active psoriatic arthritis. The use by a person of the Apotex Leflunomide Products for the treatment of active psoriatic arthritis would infringe claim 1 of the Patent. That use would be in accordance with instructions for the use of the products given by Apotex to such a person. Each supply or offer to supply made by Apotex of any of the Apotex Leflunomide Products for the treatment of active psoriatic arthritis would infringe claim 1 of the Patent pursuant to s 117 of the 1990 Act. Apotex cross-claimed for revocation of the Patent on a variety of grounds, none of which succeeded. 5 The third respondent to these proceedings, Aventisub II Incorporated, was the third applicant in the proceedings in the Federal Court of Australia and was said to be the holder of copyright in product information documents relating to the product On 18 November 2011, the primary judge dismissed the cross-claim and made a declaration that Apotex had threatened to infringe claim 1 of the Patent "by threatening to import, market, take orders for, sell, supply and offer to supply products containing leflunomide … in Australia for the treatment of psoriatic arthritis."6 Her Honour granted injunctive relief restraining Apotex from infringing claim 1 and from supplying or offering to supply products containing Leflunomide for the treatment of psoriatic arthritis. Apotex appealed to the Full Court of the Federal Court. On 18 July 2012, the Full Court (Keane CJ7, Bennett and Yates JJ8) dismissed the appeal and ordered that Apotex pay the respondents' costs of the appeal. On 14 December 2012, this Court (French CJ and Kiefel J) granted special leave to Apotex to appeal from the judgment of the Full Court in relation to the validity of the Patent and referred the application for special leave in relation to infringement to an enlarged Bench for further consideration so that it could be argued as if it were on an appeal9. Patentability of medical treatments — A "common law" question? The single ground upon which special leave was granted was that the Full Court erred in finding that the claim of the Patent claimed a manner of manufacture within the meaning of s 18(1) of the 1990 Act. The first question raised by Apotex in support of that ground is whether a method of medical treatment of human beings is capable of being a patentable invention. That question directs attention to the relevant statutory language and the body of case law which has informed its application. Section 18 of the 1990 Act lists necessary conditions for an invention to be a patentable invention for the purposes of a standard patent. One of those conditions, set out in s 18(1)(a), is that the invention, so far as claimed in any claim: "is a manner of manufacture within the meaning of section 6 of the Statute of Monopolies". 6 Sanofi-Aventis Australia Pty Ltd v Apotex Pty Ltd (No 4) (2011) 202 FCR 56. 7 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494 at (2012) 204 FCR 494 at 541 [209]. [2012] HCATrans 357. Despite the classificatory character of the criterion, the question whether it is to be met in respect of a claim for an invention is not answered simply by asking whether such a claim is "a manner of manufacture". As this Court said in National Research Development Corp v Commissioner of Patents ("NRDC")10: "The right question is: 'Is this a proper subject of letters patent according to the principles which have been developed for the application of s 6 of the Statute of Monopolies?'" It is relevant to that inquiry that the term "manner of manufacture" originated as part of a statute which was seen as declaratory of the common law. Its application in various statutory embodiments since the Statute of Monopolies 1623 ("the Statute")11 was enacted has evolved according to common law processes. It has always been applied12: "beyond the limits which a strict observance of its etymology would suggest, and ... a widening conception of the notion has been a characteristic of the growth of patent law." The Statute was a response to the abuse of grants of monopolies13 in the purported exercise of the royal prerogative14. It declared all monopolies void, subject to the proviso in s 6: 10 (1959) 102 CLR 252 at 269; [1959] HCA 67. 11 21 Jac I c 3. 12 (1959) 102 CLR 252 at 269–270, citing Maeder v Busch (1938) 59 CLR 684 at 706 per Dixon J; [1938] HCA 8. 13 3 Co Inst, c 85 at 181 defined "monopoly" as: "an institution, or allowance by the king by his grant, commission, or otherwise to any person or persons, bodies politique, or corporate, of or for the sole buying, selling, making, working, or using of any thing, whereby any person or persons, bodies politique, or corporate, are sought to be restrained of any freedome, or liberty that they had before, or hindred in their lawfull trade." 14 For a history of the patent system as an exercise of the prerogative see Hulme, "The History of the Patent System under the Prerogative and at Common Law", (1896) 12 Law Quarterly Review 141; Klitzike, "Historical Background of the English Patent Law", (1959) 41 Journal of the Patent Office Society 615; Pila, "The Common Law Invention in its Original Form", (2001) 5 Intellectual Property Quarterly 209. "Provided also That any Declaration before mentioned shall not extend to any Letters Patents and Grant of Privilege for the term of fourteen years or under, hereafter to be made of the sole working or making of any manner of new Manufactures within this Realm, to the true and first Inventor and Inventors of such Manufactures, which others at the time of making such Letters Patents and Grants shall not use, so as also they be not contrary to the Law nor mischievous to the State, by raising prices of Commodities at home, or hurt of Trade, or generally inconvenient …" (emphasis added) The Statute did not alter the common law15. It did not confer rights upon inventors16. Coke said of it17: "[T]his act maketh them [patents] no better, than they should have been, if this act had never been made". The objectives of s 6, as Cornish, Llewelyn and Aplin observed in the 8th edition of their textbook on Intellectual Property, "were the encouragement of industry, employment and growth, rather than justice to the 'inventor' for his intellectual percipience."18 Legislation enacted in the United Kingdom after the Statute provided machinery for the grant and enforcement of patents but left unaffected the central requirement for their grant in s 619. The source of power to grant patents remained the prerogative. It seems that between the enactment of the Statute and the mid-18th century the patent system was little used20. The decision of the 15 Feather v The Queen (1865) 6 B & S 257 at 284–285 [122 ER 1191 at 1201]; Australian Gold Recovery Co v Lake View Consols Ltd [1901] AC 142 at 149. 16 Von Heyden v Neustadt (1880) 14 Ch D 230 at 232. 17 3 Co Inst, c 85 at 184. See Cunynghame, English Patent Practice, (1894) at 20; Edmunds, The Law and Practice of Letters Patent for Inventions, 2nd ed (1897) at 3; Roberts, The Grant and Validity of British Patents for Inventions, (1903) at 18. 18 Cornish, Llewelyn and Aplin, Intellectual Property: Patents, Copyright, Trade Marks and Allied Rights, 8th ed (2013) at 123. 19 Statutory Declarations Act 1835 (5 & 6 Will IV c 62), s 11; Letters Patent for Inventions Act 1835 (5 & 6 Will IV c 83); Patents Act 1839 (2 & 3 Vict c 67); Judicial Committee Act 1844 (7 & 8 Vict c 69); Patent Law Amendment Act 1852 (15 & 16 Vict c 83). 20 See generally Pila, "Methods of Medical Treatment within Australian and United Kingdom Patents Law", (2001) 24 University of New South Wales Law Journal 420 Court of Common Pleas in Boulton v Bull21 was the first case in which so-called "inherent patentability" received close consideration. That case apart, there was little accumulated authority on inherent patentability in the United Kingdom before the first consolidation of patent laws in the Patents, Designs, and Trade Marks Act 1883 (UK) ("1883 UK Act")22. The 1883 UK Act defined "invention" as "any manner of new manufacture the subject of letters patent and grant of privilege within section six of the Statute of Monopolies"23. Its effect was to confer upon an inventor "the right to a patent under certain conditions"24. Subject to various amendments it remained in place for 24 years and provided a model for patents legislation in the Australian colonies prior to federation25 and for the first Commonwealth patent law, the Patents Act 1903 (Cth) ("1903 Act"). The 1883 UK Act was superseded by the Patents and Designs Act 1907 (UK) ("1907 UK Act"), which continued the definition of "invention" by reference to the Statute26. Both the 1883 and 1907 UK Acts preserved the prerogative to grant letters patent27. In the 6th edition of Terrell on the Law of Patents, published in 1921, the effect of the successive UK statutes, up to and including the 1907 statute, was described as28: "declaratory of the limits within which that [the royal] prerogative should be exercised, and of the method of procedure to be adopted in obtaining letters patent for inventions." 21 (1795) 2 H Bl 463 [126 ER 651]. 22 See generally Pila, "Methods of Medical Treatment within Australian and United Kingdom Patents Law", (2001) 24 University of New South Wales Law Journal 420 23 1883 UK Act, s 46. 24 Fletcher Moulton, The Present Law and Practice Relating to Letters Patent for Inventions, (1913) at 3. 25 Hack, "A History of the Patent Profession in Colonial Australia", paper delivered at the Annual Conference of the Institute of Patent Attorneys of Australia, Brisbane, 29–31 March 1984. 26 1907 UK Act, s 93. 27 1883 UK Act, s 116; 1907 UK Act, s 97. 28 Terrell on the Law of Patents, 6th ed (1921) at 3. The 1907 UK Act and subsequent amending legislation was repealed by the Patents Act 1949 (UK) ("1949 UK Act")29. That Act also defined "invention" in terms of "any manner of new manufacture" within s 6 of the Statute30. Like its predecessors, it preserved the prerogative of the Crown31. The 1949 UK Act was superseded by the Patents Act 1977 (UK) ("1977 UK Act"). The term "manner of manufacture" and reference to the Statute were replaced in the 1977 UK Act with a codification of the requirements of patentability. Those requirements were set out in ss 1(1) to 1(4), which were based on and intended to have, as nearly as practicable, the same effect in the United Kingdom as Arts 52 to 57 of the European Patent Convention of 197332. Methods of treatment of the human body were excluded from patent protection by s 4(2) of the 1977 UK Act as not capable of industrial application. The patent law of the United Kingdom was thereby aligned with the exclusion derived from Art 52(4) of the European Patent Convention. The Patents Act 2004 (UK) repealed s 4(2)33 and introduced a new s 4A34 into the 1977 UK Act, excluding methods of treatment of the human body from patent protection without reference to industrial applicability, subject to "an invention consisting of a substance or composition for use in any such method." That amendment implemented changes brought about by the revision of the European Patent Convention in 200035. Apotex and the respondents debated in their written submissions whether the exclusion in the 1977 UK Act was based on policy grounds or reflected pre-existing United Kingdom case law relating to inherent patentability. It is unnecessary and unhelpful to explore the factors which may have influenced the introduction of a statutory exclusion in the 1977 UK Act. There is, however, no doubt about the existence of the exclusion prior to its express enactment. 29 1949 UK Act, s 106, Second Schedule. 30 1949 UK Act, s 101(1). 31 1949 UK Act, s 102(1). 32 Convention on the Grant of European Patents, opened for signature on 5 October 1973 (entered into force 7 October 1977); 1977 UK Act, s 130(7). See Terrell on the Law of Patents, 17th ed (2011) at 10–11, 31. 33 Patents Act 2004 (UK), Sched 2, par 4(b). 34 Patents Act 2004 (UK), s 1. 35 Act revising the Convention on the Grant of European Patents of 29 November 2000 (entered into force on 13 December 2007); European Patent Convention 1973, Art 53(c). In the Report of the Banks Committee36, which preceded the enactment of the 1977 UK Act, examples were given of matter which had never been considered to be an "invention" as defined, including "treatment of human beings"37. The Committee observed that a process consisting of using a known compound for treating a human being medically had never been held to be patentable because the courts had consistently expressed the opinion that a process for medical treatment of a human being was not a proper subject for a patent monopoly38. The Committee expressed doubt whether the grant of such patents would accord with the requirements of the Strasbourg Convention39 that inventions susceptible of "industrial protection should be granted for application"40. The Patents Act 1952 (Cth) ("1952 Act"), which replaced the 1903 Act, was based upon the 1949 UK Act. It was enacted following the Report of the Dean Committee in 195241. A point made in the Report was that "in the matter of patents for inventions, there should be as close a correspondence as possible between the two Acts."42 The Committee did not recommend any change to the definition of "invention" under the 1903 Act. 36 Committee to Examine the Patent System and Patent Law, The British Patent System, (1970) Cmnd 4407. 37 Committee to Examine the Patent System and Patent Law, The British Patent System, (1970) Cmnd 4407 at 62 [213]. 38 Committee to Examine the Patent System and Patent Law, The British Patent System, (1970) Cmnd 4407 at 67 [238]. 39 Convention on the Unification of Certain Points of Substantive Law on Patents for Invention, opened for signature on 27 November 1963 (entered into force 1 August 40 Committee to Examine the Patent System and Patent Law, The British Patent System, (1970) Cmnd 4407 at 67 [240]. 41 Committee Appointed by the Attorney-General of the Commonwealth, Report of Committee Appointed to Consider what Alterations are Desirable in the Patent Law of the Commonwealth, (1952). 42 Committee Appointed by the Attorney-General of the Commonwealth, Report of Committee Appointed to Consider what Alterations are Desirable in the Patent Law of the Commonwealth, (1952) at 3 [5]. Following a Report of the Industrial Property Advisory Committee in 198443, the 1952 Act was repealed44 and the 1990 Act was enacted. The criterion that an invention must be a "manner of manufacture within the meaning of s 6 of the Statute of Monopolies" was retained. In recommending its retention, the "We consider that the existing concept operates quite satisfactorily. It has the advantage of being underpinned by an extensive body of decided case law which facilitates its application in particular circumstances." The Committee rejected the alternative of a codified definition. The rationale for retaining the existing criterion was reflected in the Explanatory Memorandum for the Patents Bill 1990, which said of the proposed definition of "invention"46: "The requirement in paragraph 18(a) ... invokes a long line of UK and Australian court decisions. It means little more than that an invention must belong to the useful arts rather than the fine arts. The Government accepted the Industrial Property Advisory Committee's recommendation that this flexible threshold test of patentability be retained in preference to adopting a more inflexible codified definition." The legislative purpose reflected in s 18(1)(a) of the 1990 Act is that the "manner of manufacture" criterion for a patentable invention ought to continue to be applied on a case-by-case basis. The processes for the ascertainment, application and development of the principles determining whether a claimed invention is a "manner of manufacture" can appropriately be described as common law processes. They accord with the fourth and fifth senses in which the term "the common law" is used, as described by Professor AWB Simpson in the New Oxford Companion to Law47 and referred to in the joint majority judgment of this Court in PGA v The Queen48. According 43 Industrial Property Advisory Committee, Patents, Innovation and Competition in Australia, August 1984. 44 1990 Act, s 230 (as enacted). 45 Industrial Property Advisory Committee, Patents, Innovation and Competition in Australia, August 1984 at 41. 46 Australia, Senate, Patents Bill 1990, Explanatory Memorandum at [31]. 47 Cane and Conaghan (eds), The New Oxford Companion to Law, (2008) at 164–166. 48 (2012) 245 CLR 355; [2012] HCA 21. to those senses of the term, the common law is "law based on cases, or law evolved through adjudication in particular cases, as opposed to law derived from the analysis and exposition of authoritative texts."49 Particularly apposite is the paraphrase in PGA of what was said by six members of this Court in the Native "the term 'common law' might be understood not only as a body of law created and defined by the courts in the past, but also as a body of law the content of which, having been declared by the courts at a particular time, might be developed thereafter and be declared to be different." Case-by-case decision-making and associated development of the law is a process characteristic of the common law. It is also a characteristic of the application by courts of broadly stated statutory provisions, the interpretation, fleshing out, and application of which the legislature has left to the courts. The prohibition of misleading or deceptive conduct in trade or commerce is one example51. Such a provision sets out broad textual parameters within which principles of law are to be ascertained, applied and developed. The boundaries between the common law process detached from a statutory context and analogous processes in a statutory setting are not firm and fixed. Indeed there are many examples of statutes which incorporate, by reference, common law concepts52. The respondents submitted that, having regard to existing practice and case law in Australia, which accepts the patentability of methods of medical treatment, the omission of the legislature to provide for the express exclusion of such claims was inconsistent with "an implied exclusion that was plainly never intended." That submission should not be accepted. As appears from the shifting history of the understanding of "manner of manufacture", legislative silence in 49 (2012) 245 CLR 355 at 370 [22]. 50 (2012) 245 CLR 355 at 371 [23], citing Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 373 at 484–486; [1995] HCA 47. 51 Competition and Consumer Act 2010 (Cth), Sched 2 (Australian Consumer Law), 52 A particularly striking example is found in s 20(1) of the Australian Consumer Law, which provides that "[a] person must not, in trade or commerce, engage in conduct that is unconscionable, within the meaning of the unwritten law from time to time." this field is an unsure guide to the development of principle53. Its invocation in this context attracts the kind of caution, only with greater emphasis, associated with the invocation of the maxim expressio unius exclusio alterius54. In any event, as explained above, s 18(1)(a) of the 1990 Act was enacted on the basis that within the framework of the case-by-case common law process, the continuing exposition and application of the criterion which it embodied would be left to the courts. The term "manner of manufacture" has long been given a wide application, which was widened by the decision of this Court in NRDC. In Boulton v Bull55, four Judges of the Court of Common Pleas divided equally on whether a patent granted to James Watt for an improved steam engine was void. It was conceded by counsel in that case that the word "manufacture" was "of extensive signification" and that it applied "not only to things made, but to the practice of making, to principles carried into practice in a new manner, to new results of principles carried into practice."56 The elaboration by Eyre LCJ of that concession was described by Dixon J in Maeder v Busch57 as one of the earliest statements, and "[p]erhaps the widest", on patentability. Eyre LCJ included in the scope of "manufacture"58: "new processes in any art producing effects useful to the public." A perhaps unintended narrowing of the scope of patentability was effected in 1942 by a list of sufficient conditions, set out in GEC's Application59, for characterising a method or process as a "manner of manufacture". The conditions, formulated by Morton J sitting as the Patents Appeal Tribunal, provided that a method or process could be so characterised if it resulted in the 53 Atiyah, "Common Law and Statute Law", (1985) 48 The Modern Law Review 1 at 25–26; Williams, "Statutes as Sources of Law Beyond their Terms in Common- Law Cases", (1982) 50 George Washington Law Review 554 at 566–567. 54 George v Federal Commissioner of Taxation (1952) 86 CLR 183 at 206; [1952] HCA 21; Benning v Sydney City Council (1958) 100 CLR 177 at 196 per Fullagar J; [1958] HCA 48. 55 (1795) 2 H Bl 463 [126 ER 651]. 56 (1795) 2 H Bl 463 at 492 per Eyre LCJ [126 ER 651 at 666]. 57 (1938) 59 CLR 684 at 705. 58 (1795) 2 H Bl 463 at 492 [126 ER 651 at 666]. 59 (1942) 60 RPC 1. production, improvement, restoration or preservation of a vendible product60. That the conditions were sufficient, disjunctive and not exhaustive appeared from "In saying this I am not attempting to cover every case which may arise by a hard and fast rule." Human nature being what it is however, linkage of a method or process to a "vendible product" seems to have been treated in practice as something approaching a necessary condition. Perhaps for that reason Morton J's list elicited a rather cautious response from Evershed J in Cementation Company Ltd's Application62. Having stated a reservation63 about the approach taken in GEC, Evershed J expressed the view that Morton J had used the word "product" in a broad sense64. Later, in Rantzen's Application65, Evershed J suggested that the term "vendible product" originated with the need to exclude from the scope of the Patent Acts methods or processes, such as those for treating diseases of the human body, which, however useful, could not be contemplated as falling within their ambit. That somewhat enigmatic, if not circular, observation may have reflected an underlying ethical objection to the patentability of such methods or processes66. In the event, constraints on the patentability of methods or processes generally, which flowed from the focus on "vendible product" in GEC, were effectively removed as a result of the response of the courts of the United Kingdom to this Court's decision in NRDC. Before turning to the relevant 60 (1942) 60 RPC 1 at 4, a concept foreshadowed in the judgment of Heath J in Boulton v Bull: see generally Pila, "Methods of Medical Treatment within Australian and United Kingdom Patents Law", (2001) 24 University of New South Wales Law Journal 420 at 425–426. 61 (1942) 60 RPC 1 at 4. 62 (1945) 62 RPC 151. 63 Namely, that having regard to the absence of any right of appeal from the decisions of the Tribunal, it was undesirable for it to lay down rules or principles for the interpretation of the Acts of Parliament which regulated the grant of patents: (1945) 62 RPC 151 at 153. 64 (1945) 62 RPC 151 at 154. 65 (1946) 64 RPC 63 at 66. 66 Kell, "Expanding the Frontier of Patentability: Methods of Medical Treatment of the Human Body", (1995) 17 European Intellectual Property Review 202 at 202. decisions of this Court and the Federal Court of Australia it is necessary to look to the ways in which, historically, the courts of the United Kingdom dealt with the application of the term "manner of manufacture" to such methods or processes. The starting point is the late 18th century decision of Boulton v Bull. Medical treatment may seem a long way from improved steam engines. However, in Boulton v Bull, Buller J discussed the scope of the term "manner of manufacture" in its application to methods and processes by reference to an hypothetical example of a medicine67 for the treatment of fever found by an ingenious physician to be "a specific cure for a consumption, if given in particular quantities"68. Could the physician be given a patent for the new use? The answer was69: "I think it must be conceded that such a patent would be void; and yet the use of the medicine would be new, and the effect of it as materially different from what is now known, as life is from death." Buller J put it thus: "[t]he medicine is the manufacture, and the only object of a patent, and as the medicine is not new, any patent for it, or for the use of it, would be void."70 Cunynghame's English Patent Practice referred to that observation as an example of the general proposition that for an "art" to be capable of being patented "[i]t must be an art connected with trade, that is to say, an industrial art."71 The author went on72: "The art of curing an illness cannot be said to be an art of manufacture, and it follows therefore that all old things may be used in new ways by private persons, provided always that in so using them they are not manufacturing anything." 67 Long before the enactment of the 1883 UK Act, medicines were regarded as satisfying the criterion of a "manner of manufacture" within s 6 of the Statute: R v Wheeler (1819) 2 B & Ald 345 at 349 per Abbott CJ [106 ER 392 at 394]; see also Schering AG's Application [1971] 1 WLR 1715 at 1717–1718 per Whitford J; [1971] 3 All ER 177 at 178–179. 68 (1795) 2 H Bl 463 at 487 [126 ER 651 at 663]. 69 (1795) 2 H Bl 463 at 487 [126 ER 651 at 663]. 70 (1795) 2 H Bl 463 at 487 [126 ER 651 at 663]. 71 Cunynghame, English Patent Practice, (1894) at 42. 72 Cunynghame, English Patent Practice, (1894) at 42–43. Cunynghame also used the example to support the proposition that a new use of an old material could not be patented unless such use itself constituted a The earliest reported case in the United Kingdom dealing directly with the patentability of a process of medical treatment arose under the 1907 UK Act in C & W's Application74. The Solicitor-General, Sir Stanley Buckmaster, on appeal from the Comptroller-General, held that "a manner of new manufacture" had to be "in some way associated with commerce and trade."75 A method for the extraction of lead from human bodies, which was the subject of the patent in that case, was not such a process76. A process to enhance the marketability of animals might be viewed differently. The decision reflected a constrained commercial notion of "manner of manufacture", which prevailed at the time77. It accorded with what had appeared in Cunynghame's textbook 20 years earlier. In his reasons for decision in C & W's Application, the Solicitor-General also attributed to the Patent Office a broad view that the application should be refused because it related to medical treatment simpliciter. He said78: "I notice that the Patent Office have based their refusal upon the ground that the alleged invention relates simply to medical treatment, and I think that the foundation for that refusal is sound." There was no elaboration in the brief reasons for judgment of the foundation for that refusal. Whatever its foundation, the Solicitor-General made clear that it had nothing to do with "humanity" or the ethics of the medical profession. He said79: 73 Cunynghame, English Patent Practice, (1894) at 42. 74 (1914) 31 RPC 235. In Schering AG's Application [1971] 1 WLR 1715 at 1718; [1971] 3 All ER 177 at 179–180, Whitford J said that C & W's Application was the earliest "record relating to any Office practice" of refusing to allow such an application to proceed to grant. 75 (1914) 31 RPC 235 at 235. 76 (1914) 31 RPC 235 at 236. 77 Wellcome Foundation Ltd v Commissioner of Patents [1979] 2 NZLR 591 at 616 78 (1914) 31 RPC 235 at 236. 79 (1914) 31 RPC 235 at 236. "I have altogether excluded such considerations from my mind." It has been suggested that despite that disclaimer, the Solicitor-General's judgment was "fuelled by his view that doctors should not, on moral grounds, seek commercial monopolies in respect of their professional skills."80 It cannot be said that a clear and stable principle underlying the exclusion posited in C & W's Application was spelt out in that case. However that may be, the practice of the Patent Office in the United Kingdom following C & W's Application was to refuse to allow applications for grants of patents where the alleged invention related simply to a medical treatment81. The definition of "invention" in the 1903 Act and the 1952 Act has been considered in a number of decisions of this Court. Obiter dicta and passing references to the patentability of medical treatments have been made in four of those decisions, but in none of them has the question of patentability been determined. The first of the four decisions of this Court was Maeder v Busch, which concerned "a process for forming permanent waves in hair". The patent was held to be invalid on the basis of prior user and want of novelty. However, it was also argued that the claimed invention was not patentable "because it deals with the living tissues of the body, and no particular method will, in all circumstances and conditions, produce upon all persons the same results"82. Latham CJ, citing C & W's Application, was "very doubtful" whether a method or process of conducting an operation upon a part of the human body could be regarded as a "manner of manufacture"83. The Chief Justice thought the question "so important and possibly so far-reaching, that it is wise to abstain from deciding it until the necessity for doing so arises."84 Dixon J appeared to accept that there must be a commercial dimension to the relevant "art" in order to enable a process to be 80 Pila, "Methods of Medical Treatment within Australian and United Kingdom Patents Law", (2001) 24 University of New South Wales Law Journal 420 at 433. 81 Joos v Commissioner of Patents (1972) 126 CLR 611 at 619–620; [1972] HCA 38; Puharich and Lawrence's Application [1965] RPC 395 at 401 per Lloyd-Jacob J; London Rubber Industries Ltd's Patent [1968] RPC 31 at 34 per Lloyd-Jacob J; Schering AG's Application [1971] 1 WLR 1715 at 1720; [1971] 3 All ER 177 at 82 (1938) 59 CLR 684 at 696. 83 (1938) 59 CLR 684 at 699. 84 (1938) 59 CLR 684 at 699. patented. There was, however, difficulty in basing legal distinctions on the motive or purpose of the operator85: "The process may be intended for use in ordinary trade or business such as that of hairdressing, manicure, pedicure. The purpose, on the other hand, may be the relief of suffering by surgical or manipulative means. But the object is not to produce or aid the production of any article of commerce. No substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence by means of or with the aid of the process." In the reference to "article of commerce" may be seen an anticipation of Morton J's "vendible product" and a reflection of Heath J's observation in Boulton v Bull86 equating "manufacture" with a vendible machine or substance. However, foreshadowing what would be said in NRDC, Dixon J referred to the "widening conception of a manner of new manufacture [that] has been a characteristic of the growth of patent law."87 In the event, like Latham CJ, he preferred to leave undecided the question whether a process for treating hair could be patentable88. Evatt J agreed with the trial judge's finding of invalidity for prior public and common user. The views expressed by Latham CJ and Dixon J in Maeder v Busch were obiter and inconclusive, but consistent with the views of the courts of the United Kingdom and Patent Office practice in the United Kingdom. Beyond Dixon J's reference to the connection of patentability to commercial purposes, there was no discussion of the underlying general principle. There was, however, a recognition of the logical difficulty involved in trying to draw a legal distinction between methods of medical treatment and other processes for treatment of the human body such as cosmetic procedures. In 1959, this Court held in NRDC, which concerned a method for using a herbicide on crops, that the application of the criterion "manner of manufacture" to a method or process was not constrained by requiring the method or process to be linked to a narrowly defined understanding of a "vendible product". The Court accepted, as had Dixon J in Maeder v Busch, that a widening conception of the notion of "manufacture" had characterised the growth of patent law89. The 85 (1938) 59 CLR 684 at 706. 86 (1795) 2 H Bl 463 at 481–482 [126 ER 651 at 660–661]. 87 (1938) 59 CLR 684 at 706. 88 (1938) 59 CLR 684 at 707 per Dixon J, see also at 699 per Latham CJ. 89 (1959) 102 CLR 252 at 270. word "product" was not to be confined to a "thing" in the sense of a physical article90: "It is, we think, only by understanding the word 'product' as covering every end produced, and treating the word 'vendible' as pointing only to the requirement of utility in practical affairs, that the language of Morton J's 'rule' may be accepted as wide enough to convey the broad idea which the long line of decisions on the subject has shown to be comprehended by the Statute." The Court applied that approach to processes, observing that91: "The point is that a process, to fall within the limits of patentability which the context of the Statute of Monopolies has supplied, must be one that offers some advantage which is material, in the sense that the process belongs to a useful art as distinct from a fine art—that its value to the country is in the field of economic endeavour." (citation omitted) The question of medical treatment arose almost peripherally in NRDC. Reference was made to R v Wheeler92, decided in 1819, in which Abbott CJ had said that the word "manufacture" required something of a corporeal and substantial nature that could be made by man from matters subjected to his art or skill or at least some new mode of employing practically his art and skill93. The Court was not prepared to treat that statement as conclusive of the question. It said94: "The need for qualification must be confessed, even if only in order to put aside, as they apparently must be put aside, processes for treating diseases of the human body: see Re C & W's Application; Maeder v Busch." (footnotes omitted) Immediately after the passage about processes quoted in the preceding paragraph of these reasons, the Court speculated, in parentheses, that the exclusion of methods of surgery and other processes for treating the human body could well 90 (1959) 102 CLR 252 at 276. 91 (1959) 102 CLR 252 at 275. 92 (1819) 2 B & Ald 345 [106 ER 392]. 93 (1819) 2 B & Ald 345 at 350 [106 ER 392 at 395], cited in (1959) 102 CLR 252 at 94 (1959) 102 CLR 252 at 270. lie outside the conception of invention "because the whole subject is conceived as essentially non-economic"95. It did not otherwise identify a rationale for the exclusion. So far as it held that the notion of "manner of manufacture" in its application to a method or process was not limited by a narrow requirement related to the production, improvement, restoration or preservation of a "vendible product", NRDC was approved and followed in the United Kingdom96. Initially it was not seen as displacing the authority of C & W's Application or the Patent Office practice of rejecting claims for methods of medical treatment97. Arguments that such claims should be accepted after NRDC did not find favour with supervising examiners in United States Rubber Co's Application98 and London Rubber Industries Ltd's Patent99, the latter decision being supported on appeal by Lloyd-Jacob J100. In Schering AG's Application101, Whitford J, delivering the decision of the Patents Appeal Tribunal, consisting of Graham J and himself, accepted that it was "difficult to see any logical justification for the practice in relation to processes for medical treatment"102. However, he found a distinction relevant to the patentability of medicines and the non-patentability of medical treatments in s 41 of the 1949 UK Act, which provided for the compulsory licensing of medicines. There was no such provision in relation to methods of medical treatment103. Whitford J foreshadowed the possibility of change following the implementation of the Report of the Banks Committee, and said104: 95 (1959) 102 CLR 252 at 275. 96 Swift & Co's Application [1962] RPC 37 at 47 per Parker LCJ. 97 London Rubber Industries Ltd's Patent [1968] RPC 31 at 34–35 per Lloyd-Jacob J. 98 [1964] RPC 104. 99 [1968] RPC 31 at 32–33. 100 [1968] RPC 31 at 34–35. 101 [1971] 1 WLR 1715; [1971] 3 All ER 177. 102 [1971] 1 WLR 1715 at 1720; [1971] 3 All ER 177 at 181. 103 [1971] 1 WLR 1715 at 1721; [1971] 3 All ER 177 at 182. 104 [1971] 1 WLR 1715 at 1721; [1971] 3 All ER 177 at 182. "On a consideration of the terms of the statute as it now stands, it does, however, seem that claims to processes for medical treatment must be considered as being excluded from the scope of the Act and the practice of the office. Whatever, therefore, the origin of the exclusion may be, in so far [as] it relates to processes for the medical treatment of human beings to cure or prevent disease, it must be considered sound." That observation left unrevealed the continuing basis for the exclusion beyond its long existence. Thirteen years after NRDC, in Joos v Commissioner of Patents105 Barwick CJ reversed a decision of the Deputy Commissioner of Patents that an application for the grant of letters patent for a process for the treatment of parts of the human body, namely human hair and nails, whilst attached to or growing upon the human body, should not proceed. The Chief Justice put to one side, as obiter, what had been said in Maeder v Busch concerning the patentability of processes for treating human beings106. He expressed scepticism about the speculation in NRDC that medical treatment was excluded as essentially non-economic107. He spoke of the national economic interest in "the repair and rehabilitation of members of the work force, including management"108. He accepted, for the purpose of the appeal before him, that a narrowly defined class of process for the medical treatment of a part of the human body, the arrest or cure of a disease or diseased condition, or the correction of some malfunction or the amelioration of some incapacity or disability was not a proper subject of letters patent109. The Chief Justice was not concerned to discover and express a basis for the exclusion. If he had to do so he would "place the exception, if it is to be maintained, on public policy as being, in the language of the Statute of Monopolies, 'generally inconvenient', not limiting what may fall within those words to things of a like kind to those described by the preceding words."110 As to that, it may be noted that Apotex has expressly disclaimed any reliance upon the "generally inconvenient" proviso in s 6 of the Statute. 105 (1972) 126 CLR 611. 106 (1972) 126 CLR 611 at 618. 107 (1972) 126 CLR 611 at 618. 108 (1972) 126 CLR 611 at 618. 109 (1972) 126 CLR 611 at 619. 110 (1972) 126 CLR 611 at 623. In Eli Lilly & Co's Application111, decided in 1974, the same Patents Appeal Tribunal which had decided Schering AG's Application asserted an ethical support for the exclusion. Their Honours cited NRDC as an authority against a limited approach to the definition of "invention" by reference to the idea of making tangible goods112. Nevertheless, NRDC was not seen as warranting a judge-made change to the exclusionary rule113: "It has long been established that claims to methods of medical treatment should not be accepted ... The reasons for such an exclusion appear to us to be based in ethics rather than logic but if there is to be a change of policy, which would appear to us to be sensible, this ought in our view to be effected by legislation rather than by interpretation." In similar vein, the Court of Appeal in The Upjohn Company (Robert's) "If the law in this regard should be changed, it must be for the legislature." the narrow definition of medical In Australia, following Joos, Patent Office practice excluded claims falling within treatment adopted by Barwick CJ116. In 1992, however, an important change in Australian law was initiated by the judgment of Gummow J in Rescare Ltd v Anaesthetic Supplies Pty Ltd117 in reasoning upheld by the Full Court of the Federal Court on appeal118. Those decisions were much influenced by the first instance decision, in 1979, of the former Chief Justice of New Zealand, Davison CJ, in Wellcome Foundation Ltd v Commissioner of Patents ("Wellcome Foundation")119. Reference should be made to that decision. 111 [1975] RPC 438. 112 [1975] RPC 438 at 444. 113 [1975] RPC 438 at 445. 114 [1977] RPC 94. 115 [1977] RPC 94 at 98. 116 Australian Patent Office, Patent Examiner's Manual, (1984) at [35.80]. 117 (1992) 111 ALR 205. 118 Anaesthetic Supplies Pty Ltd v Rescare Ltd (1994) 50 FCR 1. 119 [1979] 2 NZLR 591. the United Kingdom and Australia from 1914 Davison CJ held that the rationale for C & W's Application, namely that a method of treatment lacks connection with any form of manufacture or trade, could not stand in the light of NRDC120. The Chief Justice could find no other grounds for refusal of a patent for medical treatment stated in the decided cases Any long-established practice based on C & W's Application was no longer applicable122. He rejected the proposition in Eli Lilly that the ground for the exclusion was ethical123. The basis of the exclusion had always been that medical treatment was neither "an art of manufacture" nor a "form of manufacture or of trade". He quoted and relied upon the observations of Witkon J in the Supreme Court of Israel in The Wellcome Foundation Ltd v Plantex Ltd124: "There is thus no ground, either in law or in logic, for holding that a method of therapeutic treatment is unpatentable and any consideration that at one time might possibly have justified such a holding, is nowadays devoid of any substance. It may certainly not be said that such an invention is not within the realm of economic endeavour in accordance with the test laid down in NRDC's Application or that it is within the realm of 'fine art' as distinct from 'useful art'." (citation omitted) Kahn and Kister JJ agreed with Witkon J, subject to a qualification against the patentability of a new use for a known therapeutic substance, composition or device125. The decision of the Supreme Court of Israel involved the application of the Mandatory Patents and Designs Ordinance. It was common ground that in the general administration of the Ordinance, the Court was guided by the English law and practice on patents. Davison CJ's decision was reversed by the Court of Appeal126. Cooke J held that the law had not developed "to the point of holding patentable a process 120 [1979] 2 NZLR 591 at 617–618. 121 [1979] 2 NZLR 591 at 617. 122 [1979] 2 NZLR 591 at 617. 123 [1979] 2 NZLR 591 at 619–620. 124 [1979] 2 NZLR 591 at 609, citing [1974] RPC 514 at 536. 125 [1974] RPC 514 at 540 per Kahn J, 542 per Kister J. 126 Wellcome Foundation Ltd v Commissioner of Patents [1983] NZLR 385. for the treatment of human illness or a new use of a known therapeutic drug."127 While acknowledging what Barwick CJ had said in Joos about the national invoked countervailing ethical considerations economic referring to "a deep-seated sense that the art of the physician or the surgeon in alleviating human suffering does not belong to the area of economic endeavour or trade and commerce."128 McMullin J129 and Somers J130 took similar approaches. The Court of Appeal in Wellcome Foundation held that any alteration to favour the grant of patents for methods of treating illness would best be left to parliament. It was the kind of alteration that demanded "a far wider range of review than is available to courts following our traditional and valuable adversary system"131. The Rescare decisions concerned a patent for a device for treating sleep apnoea. Gummow J, at first instance, deciding in favour of patentability of a method claim, accepted the reasoning of Davison CJ in Wellcome Foundation132. He rejected arguments that the patenting of such methods would be "generally inconvenient" within s 6 of the Statute133. He also accepted the proposition, reflecting what Dixon J had said in Maeder v Busch, that under the 1952 Act "there was no normative distinction to be drawn between those processes for treatment of the human body for disease, malfunction or incapacity, and for cosmetic purposes."134 On appeal, a majority of the Full Court of the Federal Court agreed with Gummow J135. Lockhart J accepted that NRDC expounded the exclusion of 127 [1983] NZLR 385 at 388. 128 [1983] NZLR 385 at 388. 129 [1983] NZLR 385 at 398–399. 130 [1983] NZLR 385 at 404. 131 [1983] NZLR 385 at 391, quoting from Pirelli General Cable Works Ltd v Oscar Faber & Partners [1983] 2 AC 1 at 19 per Lord Fraser of Tullybelton quoting Lord Simon of Glaisdale in Miliangos v George Frank (Textiles) Ltd [1976] AC 443 at 132 (1992) 111 ALR 205 at 238. 133 (1992) 111 ALR 205 at 238–239. 134 (1992) 111 ALR 205 at 239. 135 (1994) 50 FCR 1. His Honour's decision turned on a finding that the claims of the patent were not fairly based on the provisional specification. The conclusions on (Footnote continues on next page) processes for medical treatment of the human body, but found the ground of the exclusion "not entirely clear"136. The United Kingdom cases did not disclose a persuasive ground for the exclusion after the foundation for the decision in C & W's Application had been removed137. Adopting the reasoning of Davison CJ, his Honour said138: "In my opinion, there is no justification in law or in logic to say that simply because on the one hand substances produce a cosmetic result or a functional result as opposed to a curative result, one is patentable and the other is not. I see no reason in principle why a method of treatment of the human body is any less a manner of manufacture than a method for ridding crops of weeds as in NRDC." His Honour would have included a new use for an old compound as within the scope of a patentable invention. He said139: "If a process which does not produce a new substance but nevertheless results in 'a new and useful effect' so that the new result is 'an artificially created state of affairs' providing economic utility, it may be considered a 'manner of new manufacture' within s 6 of the Statute of Monopolies". (citations omitted) Wilcox J agreed with Lockhart J, adding the observation that the Australian Parliament had not been persuaded by policy considerations against patentability to provide an express exclusion for methods of medical treatment of human beings140. Sheppard J rested his dissent upon the proposition that the grant of a patent for medical treatment was "generally inconvenient" within the meaning of s 6 of the Statute141. In so doing he explicitly invoked ethical considerations142: the patentability of medical treatment were strictly obiter, as were the comments of the Full Court on appeal. 136 (1994) 50 FCR 1 at 10–11. 137 (1994) 50 FCR 1 at 18. 138 (1994) 50 FCR 1 at 19. 139 (1994) 50 FCR 1 at 19. 140 (1994) 50 FCR 1 at 42. 141 (1994) 50 FCR 1 at 32. 142 (1994) 50 FCR 1 at 41. "the Court should not contemplate the grant of letters patent which would give to one medical practitioner, or perhaps a group of medical practitioners, a monopoly over, for example, a surgical procedure which might be greatly beneficial to mankind. Its denial might mean the death or unnecessary suffering of countless people." The fourth and most recent reference by this Court to the question of patentability of medical treatments was made in 1998 in Advanced Building Systems Pty Ltd v Ramset Fasteners (Aust) Pty Ltd143. In considering the operation of s 100 of the 1952 Act, setting out the grounds of revocation of a standard patent, the majority, Brennan CJ, Gaudron, McHugh and Gummow JJ, referred to the content of s 100(1)(d) having regard to the other specific grounds "Section 6 of the Statute of Monopolies excluded any manner of new manufacture which was 'contrary to the Law' or 'generally inconvenient'. The classification of certain methods of treatment of the human body as an inappropriate subject for grants under the Act appears to rest on this footing." (footnote omitted) That observation was footnoted by reference to Joos. It appears to have been no more than an acknowledgement, rather than an adoption, of a basis upon which the claimed exclusion was said to rest. In Bristol-Myers Squibb Co v FH Faulding & Co Ltd145, the Full Court of the Federal Court followed its earlier decision in Rescare146. Black CJ and Lehane J in their joint judgment identified147: "the insurmountable problem, from a public policy viewpoint, of drawing a logical distinction which would justify allowing patentability for a product for treating the human body, but deny patentability for a method of treatment". A second compelling consideration was148: 143 (1998) 194 CLR 171; [1998] HCA 19. 144 (1998) 194 CLR 171 at 190 [34]. 145 (2000) 97 FCR 524. 146 (2000) 97 FCR 524 at 529–530. 147 (2000) 97 FCR 524 at 530 (emphasis in original). "the very limited extent to which the Parliament dealt with patents with respect to the human body when it enacted the 1990 Act, bearing in mind, too, that it did so at a time when the long-standing practice in Australia was ... to grant patents for methods of medical treatment of the human body." The question whether the exclusion from patentability of methods of medical treatment subsisted had been resolved in the negative by two decisions of the Full Court of the Federal Court. In the meantime, in New Zealand, the decision of Davison CJ, which had been influential in the reasoning adopted at first instance in Rescare and by the Full Court in Rescare and Bristol-Myers, was itself to receive a short-lived vindication from the Court of Appeal. In 1999, the Court of Appeal of New Zealand, sitting a Bench of five Judges in Pharmaceutical Management Agency Ltd v Commissioner of Patents ("Pharmac")149, overruled its earlier decision in Wellcome Foundation insofar as it would have excluded, from patentability, so-called "Swiss form" claims. As described in Wellcome Foundation, in such a claim the integer representing the inventive subject matter and novelty is the new use for which the medicament is made. In delivering the judgment of the unanimous Court in Pharmac however, Gault J made some broader observations antithetical to the reasoning of the Court of Appeal in Wellcome Foundation. His Honour agreed with Davison CJ's conclusion at first instance in Wellcome Foundation that there was little logic in maintaining the exclusion150. In so doing, he referred to the decisions of Gummow J and the Full Court of the Federal Court in Rescare. Gault J said151: "What emerges from this is that it no longer can be said that a method of treating humans cannot be an invention. To the extent that the judgments in Wellcome express that view we depart from them. The exclusion from patentability of methods of medical treatment rests on policy (moral) grounds. The purpose of the exclusion is to ensure that medical practitioners are not subject to restraint when treating patients. It does not extend to prevent patents for pharmaceutical inventions and surgical equipment for use in medical treatment." Despite the generality of his Honour's observations about the patentability of methods of medical treatment, Gault J indicated later in his reasons for judgment 148 (2000) 97 FCR 524 at 530. 149 [2000] 2 NZLR 529. 150 [2000] 2 NZLR 529 at 538 [27]. 151 [2000] 2 NZLR 529 at 538 [29]. that the Court of Appeal was only deciding the "narrow question", namely whether there could be invention and novelty in the discovery of unrecognised properties of known pharmaceutical compounds152. The Court of Appeal of New Zealand in Pfizer Inc v Commissioner of Patents153 characterised the decision in Pharmac as one concerned with the patentability of Swiss form claims and said154: "In our view the medical treatment exclusion does have a statutory base, and to the extent that the obiter observation in Pharmac may cast doubt on that, we would respectfully differ." The generality of the observation in Pharmac was at odds with what was decided in Wellcome Foundation. Nevertheless, following Pfizer the position in New Zealand appears to be that the exclusion of methods of medical treatment of human beings from patentability is maintained. Approach to resolution of the question of patentability It may be concluded from the preceding survey that the question whether a particular class of claimed invention meets the criterion of being "a manner of manufacture" requires for its resolution the application of the common law process discussed earlier in these reasons. The question whether medical treatments for human beings generally and new medical uses of non-pharmaceutical products in particular are capable of being "manners of manufacture", must be decided according to principles and constraints of the kind applicable to the development of the common law. An important constraint is that a propounded development of legal principle involving large questions of public policy and reconciliation of interests in tension is, for the most part, best left to the legislature. On the other hand, a qualification or exception to a general principle may have become anomalous to such an extent that its removal would enhance the logical and/or normative coherence of the law. The history of the exclusion of medical treatments from patentability does not disclose a stable, logical or normative foundation and seems to depend upon rather nice distinctions for its maintenance. As recognised in Eli Lilly, there is a logical and normative tension between the patentability of pharmaceutical products and the exclusion from patentability of methods of medical treatment. Moreover, there is difficulty in drawing a boundary between medical and cosmetic procedures. The latter may include procedures having both medical and cosmetic benefits: for 152 [2000] 2 NZLR 529 at 546 [64]. 153 [2005] 1 NZLR 362. 154 [2005] 1 NZLR 362 at 376 [64]. example, lap band surgery. The endeavour to achieve coherence in this area falls more readily within the institutional competence of the courts than an endeavour to strike some balance between competing public and private interests. The field of intellectual property law generally is notoriously one in which there are public interests and private interests in fierce competition with each other. A public interest may lie in using the grant of monopoly to encourage technical innovation. A competing public interest may lie in ensuring unconstrained access by medical practitioners and their patients to new medical methods and processes. The interests of inventors and investors in inventions and the interests of members of the public whose lives could be improved or saved by use of innovative medical treatments may be in tension with each other and with aspects of the public interest. There is room for debate about whether the law does or should reflect "proprietarianism" as its "dominant normative influence"155 or whether it should be seen as "instrumental" in support of publicly beneficial goals. Professor Peter Drahos has written of the latter approach156: "The practical import of the theory would be that the interpretation of intellectual property law would be driven in a systematic fashion by the purpose of that law rather than more diffuse moral notions about the need to protect pre-legal expectations based on the exercise of labour and the creation of value." The identification of the public policy objectives of a statute is a matter within the institutional competency of the courts. Choosing between or balancing competing objectives may overlap with the legislative function. As a general proposition, the reasoning of Gummow J at first instance in Rescare and of Lockhart J on appeal to the Full Court, and that of Davison CJ at first instance in Wellcome Foundation, lend powerful support to the proposition that the exclusion of medical treatment is an anomalous qualification on the principles governing patentability under the rubric "manner of new manufacture". A decision to dispense with the exclusion may be seen as a development of existing principle. To the extent that the Court enunciates such a development to enhance coherence in the law, it is not required to endeavour to resolve complex tensions between public and private interests which may be affected. Such tasks are largely matters for the legislature. They may require informed appraisal of a range of considerations backed by empirical evidence and expert advice concerning the practical significance of striking the balance in any particular way. The question whether, in the interests of coherence, this Court should support or reject the propounded exclusion of methods of medical treatment 155 Drahos, A Philosophy of Intellectual Property, (1996) at 203. 156 Drahos, A Philosophy of Intellectual Property, (1996) at 220. should now be considered in light of the decisions below and the submissions put to this Court by the parties. First it is appropriate to refer briefly to the decisions at first instance and in the Full Court. The decisions in the Federal Court At first instance, Apotex did not challenge the correctness of the Full Court's decisions in Rescare and Bristol-Myers, but reserved the right to do so on appeal157. In its written submissions to the Full Court, Apotex contended first that methods of medical treatment are not patentable, and second that methods of medical treatment for a "second or later medical use" are not patentable158. In oral argument to the Full Court, Apotex did not press the first contention, that methods of medical treatment are not patentable. Apotex's second use contention fell away because of the view that the Full Court formed of the proper construction of the claim in the Patent. On the first contention, Keane CJ, having referred to the decision of the Full Court in Rescare, said that the question whether or not patentability should be expanded to cover methods of medical treatment was a matter for determination by the legislature, rather than the judiciary below the level of this Court159. Bennett and Yates JJ took a similar approach to the Rescare and Bristol-Myers decisions. Like Keane CJ160, and like Wilcox J in Rescare161, they placed some weight upon legislative silence on the topic162. Their Honours expressed no view on Apotex's contention relating to second or later use163. Patentability of medical treatments — A common law answer Apotex submitted, correctly, that a method of treating a human being with a known substance was never held to be capable of being an invention under the 1949 UK Act and its predecessors. Its submission that that was the position which had been accepted before 1990 as the law in Australia attached a more definite characterisation to Maeder v Busch and NRDC than the reasons in those 157 (2011) 196 FCR 1 at 37 [143]. 158 (2012) 204 FCR 494 at 500–501 [23]. 159 (2012) 204 FCR 494 at 501 [26]. 160 (2012) 204 FCR 494 at 501 [26]. 161 (1994) 50 FCR 1 at 42–43. 162 (2012) 204 FCR 494 at 537 [193]. 163 (2012) 204 FCR 494 at 538 [195]. decisions could bear. It is, however, correct to say that the exclusionary proposition has not been examined directly in any decision of this Court. While the obiter observations in the decisions reviewed in these reasons invite respect and close attention, they do not determine the answer to the question before this Court in this appeal. The respondents submitted that Apotex's argument required the recognition of a special exclusion from the concept of patentability in relation to methods of human treatment. They invoked legislative inaction on the question as negativing an implied exclusion. That aspect of their submission should not be accepted. The resolution of this important question cannot rest upon the shifting sands of legislative silence. The argument has to engage with the case- by-case development of principle, which the legislature has left to the courts, as appears from the Explanatory Memorandum to the 1990 Act and the acceptance, reflected in that Memorandum, of the rationale for retaining "manner of manufacture" as a criterion of patentability. today be conceived as "essentially non-economic". The primary submission of the respondents on the question of the exclusion should be accepted. The exclusion from patentability of methods of medical treatment represents an anomaly for which no clear and consistent foundation has been enunciated. Whatever views may have held in the past, methods of medical treatment, particularly the use of pharmaceutical drugs, cannot Although Barwick CJ's reference in Joos to the national economic interest in "the repair and rehabilitation of members of the work force" may be seen as reducing human beings to economic units, there is no gainsaying the economic significance of medical treatments independently of the flow-on benefits of a well-maintained work force. Recognition of the economic dimensions of this question is not inconsistent with the concurrent recognition of the large public policy questions which it raises. They may involve competing philosophies of proprietarianism and instrumentalism and the relative values to be accorded to different public goods: alleged incentives to innovation on the one hand, and the widest possible availability of new methods of medical treatment to relieve suffering on the other. To decide that the concept of "manner of new manufacture" does not logically exclude methods of medical treatment from patentability does not engage with those large questions, although it may have significant consequences for public policy. This is a case in which such considerations are best left to the legislature. In my opinion the application of the rubric "manner of new manufacture" in a logically and normatively coherent way is not served by excluding from its scope methods of medical treatment of human beings. Methods of medical treatment can fall within the scope of a manner of new manufacture within the meaning of s 6 of the Statute and therefore within s 18(1)(a) of the 1990 Act. Nor, on the reasoning which supports that conclusion, does "general inconvenience" (upon which, in any event, Apotex placed no reliance) appear to provide any basis for their exclusion. Conclusion On the remaining questions concerning the purposive character of the Patent and the application for special leave on the question of infringement, I agree with the reasons given by Crennan and Kiefel JJ. I agree with the orders proposed by their Honours164. 164 Reasons of Crennan and Kiefel JJ at [306]. Hayne The issue The issue in the appeal to this Court is whether the method of prevention or treatment of human disease claimed in the patent in suit is a patentable invention. There is no decision of this Court which determines that a method of prevention or treatment of human disease is a proper subject for the grant of a patent. In this case, the Full Court of the Federal Court followed165 two earlier decisions166 of that Court holding that a method of prevention or treatment of human disease is a patentable invention. These reasons will demonstrate that a method of prevention or treatment of human disease is not a patentable invention. Such a method, even if it is novel167, involves an inventive step168 and is useful169, is a method or process used to produce a product (a result, outcome or effect) which is personal to the individual concerned. Use of the method or process may allow the individual better to exploit his or her capacities economically (whether by selling his or her labour or otherwise). The individual's more effective use of his or her capacities may be of economic advantage to society or some section of it. But that advantage follows from what the individual can do and chooses to do. Others, including the person who owns the right to use the method or process, cannot trade in or otherwise exploit the improvement in health that results from using the method or process to prevent or treat disease in the individual concerned. That kind of result places the process beyond the (very wide) ambit of a "manner of manufacture" within the meaning170 of s 6 of the Statute of Monopolies 1623 (21 Jac I c 3). A method of preventing or treating human disease is a process which is not a proper subject for the grant of a patent. 165 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494. 166 Anaesthetic Supplies Pty Ltd v Rescare Ltd (1994) 50 FCR 1; Bristol-Myers Squibb Co v F H Faulding & Co Ltd (2000) 97 FCR 524. 167 Patents Act 1990 (Cth), s 18(1)(b)(i). 168 s 18(1)(b)(ii). 169 s 18(1)(c). 170 s 18(1)(a). Hayne The organisation of these reasons These reasons will describe the facts of the matter shortly (under the headings: "Leflunomide" and "Apotex's product") and then record the essential features of the proceedings in the Federal Court and in this Court. Consideration of the substantive issues in the appeal commences with the statutory framework (under the headings: "Patentable invention – a statutory question" and "Asking the right question about the statute"). One issue which was not raised, and must be put aside from consideration, is identified (under the heading: "'[G]enerally inconvenient'"), and two warnings are given (under the headings: "Analogical reasoning" and "The dangers of verbal formulae"). Consideration of the substantive issues proceeds thereafter (under the headings: "The NRDC Case and 'vendible product'" and "Methods of prevention or treatment of human disease"). Separate consideration is then given to six cases bearing on the patentability of methods of prevention or treatment of human disease (In the Matter of C & W's Application for a Patent171, Maeder v Busch172, National Research Development Corporation v Commissioner of Patents173 ("the NRDC Case"), London Rubber Industries Ltd's Patent174, In re Schering AG's Application175 and Joos v Commissioner of Patents176). Having summarised the position reached in those cases (under the heading: "The state of authority after Joos"), these reasons then examine the Federal Court's earlier decisions in Anaesthetic Supplies Pty Ltd v Rescare Ltd177 and Bristol-Myers Squibb Co v F H Faulding & Co Ltd178. In the light provided by all eight of the cases that have been mentioned, four questions which arise from the decisions are further identified (under the heading: "The questions presented by the cases"). Those questions are then 171 (1914) 31 RPC 235. 172 (1938) 59 CLR 684; [1938] HCA 8. 173 (1959) 102 CLR 252; [1959] HCA 67. 174 [1968] RPC 31. 175 [1971] 1 WLR 1715; [1971] 3 All ER 177. 176 (1972) 126 CLR 611; [1972] HCA 38. 177 (1994) 50 FCR 1. 178 (2000) 97 FCR 524. Hayne examined (under the headings: "Legislative silence in the face of past practice?"; "Distinguishing between patentability of pharmaceutical substances and methods of treatment"; "Economic significance of process or product?"; and "The product of prevention or treatment of human disease"). Finally, brief consideration is given to an issue of threatened infringement which would arise if the patent in suit were valid. Leflunomide In December 1979, Hoechst AG179 was granted Australian Patent Number 529341 ("the 341 patent"). Claim one of the 341 patent claimed a compound called, in these proceedings, "leflunomide", which has since been used to treat active rheumatoid arthritis ("RA") and active psoriatic arthritis ("PsA"). Claim four of the 341 patent claimed a "[m]ethod for the treatment of inflammations, rheumatic complaints or multiple sclerosis by administering to the patient an effective amount" of leflunomide. The 341 patent expired in 2004. In 1999, leflunomide was included on the Australian Register of Therapeutic Goods ("the ARTG") then maintained under s 17 of the Therapeutic Goods Act 1989 (Cth) ("the TGA"). Section 16(1)(e) of the TGA provided that, for the purposes of those provisions of the TGA which concerned the ARTG, "therapeutic goods are to be taken to be separate and distinct from other therapeutic goods if they have ... different indications". The term "indications" was defined180, in relation to "therapeutic goods", as "the specific therapeutic uses of the goods". Leflunomide was initially registered on the ARTG giving, as its indication, the treatment of active RA. That registration was later extended to include an indication for active PsA. Leflunomide was "not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease". On 29 March 1994, Hoechst AG applied for the patent in suit (Australian Patent Number 670491). It claimed "[a] method of preventing or treating a skin disorder, wherein the skin disorder is psoriasis, which comprises administering to a recipient an effective amount of a pharmaceutical composition containing as an active ingredient" leflunomide. The patent will expire in 2014. 179 The appeal to this Court was conducted on the basis that Hoechst AG later became a part of the second respondent. The parties drew no distinction in argument between the respondents. Consequently, these reasons do not distinguish between the respondents. 180 Therapeutic Goods Act 1989 (Cth), s 3(1). Hayne Apotex's product In 2008, the appellant ("Apotex") obtained registration on the ARTG of its generic version of leflunomide. The product information document for Apotex's product ("Apo-Leflunomide") indicated the use of the product for the treatment of active RA and active PsA and, like leflunomide, said that Apo-Leflunomide was "not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease" (emphasis added). The proceedings The respondents brought proceedings in the Federal Court alleging, among other things, that Apotex would infringe the patent in suit by supplying Apo-Leflunomide in Australia for the treatment of PsA. Apotex disputed the validity of the patent in suit and denied that its supply of Apo-Leflunomide for the treatment of PsA would infringe that patent. The primary judge, Jagot J, held181 that the patent in suit is valid and that, because use of the compound to treat PsA would inevitably treat or prevent psoriasis, Apotex's intended supply of Apo-Leflunomide for the treatment of PsA would infringe the patent in suit. The primary judge noted182 that Apotex reserved its right to challenge the correctness of what had been said in the two earlier Full Court decisions about whether a method of prevention or treatment of human disease was patentable. Apotex's appeal to the Full Court of the Federal Court (Keane CJ, Bennett and Yates JJ) was dismissed183. The plurality (Bennett and Yates JJ) observed184 that "the position represented by the dicta in this Court that support the patentability of methods of medical treatment" was a position which "represent[ed] orthodoxy in Australian patent law". How or why those dicta were to be regarded as concluding the issue was neither explored nor explained. By special leave, Apotex appealed to this Court, alleging that the patent in suit is invalid. Apotex also sought special leave to appeal against the Full Court's dismissal of its appeal against the finding of threatened infringement. That application for special leave was referred for argument, as if on appeal, together with the appeal. 181 Sanofi-Aventis Australia Pty Ltd v Apotex Pty Ltd (No 3) (2011) 196 FCR 1. 182 (2011) 196 FCR 1 at 37 [143]. 183 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494. 184 (2012) 204 FCR 494 at 537 [193]. Hayne Resolution of the issue of patentability must begin by identifying the right question to ask, and that, in turn, must begin with the statute. Patentable invention – a statutory question The patent in suit was granted under the Patents Act 1990 (Cth) ("the 1990 Act"). At that time, s 18 of the 1990 Act provided that: "(1) Subject to subsection (2), a patentable invention is an invention that, so far as claimed in any claim: is a manner of manufacture within the meaning of section 6 of the Statute of Monopolies; and (b) when compared with the prior art base as it existed before the priority date of that claim: is novel; and involves an inventive step; and is useful; and (d) was not secretly used in the patent area before the priority date of that claim by, or on behalf of, or with the authority of, the patentee or nominated person or the patentee's or nominated person's predecessor in title to the invention. (2) Human beings, and the biological processes for their generation, are not patentable inventions." Section 6 of the Statute of Monopolies relevantly provided: "That any Declaration before-mentioned shall not extend to any Letters Patents and Grants of Privilege for the Term of fourteen Years or under, hereafter to be made, of the sole Working or Making of any manner of new Manufactures within this Realm, to the true and first Inventor and Inventors of such Manufactures, which others at the Time of Making such Letters Patents and Grants shall not use, so as also they be not contrary to the Law, nor mischievous to the State, by raising Prices of Commodities at home, or Hurt of Trade, or generally inconvenient". Asking the right question about the statute Section 18(1)(a) of the 1990 Act provided that a patentable invention is an invention that (among other things) is "a manner of manufacture within the meaning of section 6 of the Statute of Monopolies". In this respect, the Hayne 1990 Act, like its predecessors the Patents Act 1903 (Cth)185 and the Patents Act 1952 (Cth)186 ("the 1952 Act"), and corresponding Acts of the United Kingdom187, defined "the word 'invention', not by direct explication and in the language of its own day, nor yet by carrying forward the usage of the period in which the Statute of Monopolies was passed, but by reference to the established ambit of s 6 of that Statute"188. That is, the statutory expression – "a manner of manufacture within the meaning of section 6 of the Statute of Monopolies" – is not to be understood, or applied, by taking its words and attempting to assign one or more synonyms to any or each of them to produce some other collection of words intended to mark out the metes and bounds of the field which the expression as a whole, or the particular phrase "manner of manufacture", is to be understood as describing. Rather, as was held189 in the NRDC Case: "The inquiry which the definition [of 'invention'] demands is an inquiry into the scope of the permissible subject matter of letters patent and grants of privilege protected by the section. It is an inquiry not into the meaning of a word so much as into the breadth of the concept which the law has developed by its consideration of the text and purpose of the Statute of Monopolies. ... It is therefore a mistake, and a mistake likely to lead to an incorrect conclusion, to treat the question whether a given process or product is within the definition as if that question could be restated in the form: 'Is this a manner (or kind) of manufacture?' It is a mistake which tends to limit one's thinking by reference to the idea of making tangible goods by hand or by machine, because 'manufacture' as a word of everyday speech generally conveys that idea." (emphasis added) Accordingly, this Court held190, in the NRDC Case, that in determining whether a given process or product is within the statutory definition of "invention", the right question to ask is: "Is this a proper subject of letters patent 187 Patents, Designs, and Trade Marks Act 1883 (UK), s 46; Patents and Designs Act 1907 (UK), s 93; Patents Act 1949 (UK), s 101(1). By contrast, the Patents Act 1977 (UK), reflecting the terms of Art 52 of the Convention on the Grant of European Patents (1973), did not define a patentable invention by reference to the Statute of Monopolies. 188 NRDC Case (1959) 102 CLR 252 at 269. 189 (1959) 102 CLR 252 at 269. 190 (1959) 102 CLR 252 at 269. Hayne according to the principles which have been developed for the application of s 6 of the Statute of Monopolies?" Before dealing further with the question whether the claim made in the patent in suit is a proper subject of letters patent, it is necessary to say something about the closing words of the operative part of s 6 of the Statute of Monopolies: "so as also they be not contrary to the Law, nor mischievous to the State, by raising Prices of Commodities at home, or Hurt of Trade, or generally inconvenient" (emphasis added). "[G]enerally inconvenient" The appellant did not submit that this Court should decide whether the grant of a patent for a method of prevention or treatment of human disease would be "generally inconvenient", and thus within the exception to s 6 of the Statute of Monopolies. The respondents submitted that, in light of the way in which the proceedings below were conducted, no argument of that kind was open to the appellant in this Court. In these circumstances, it is neither necessary nor appropriate to consider whether, or how, the "generally inconvenient" exception to s 6 might apply to this case. It is not necessary, therefore, to examine what material a court could, or should, have available for consideration in deciding that question, or whether all of that material could, or should, be proved in the ordinary way. At first sight, a question about "generally inconvenient" appears to invite attention, in a case of this kind, to the costs of, and the benefits flowing from, granting a patent for a method of prevention or treatment of human disease. In turn, those questions of costs and benefits appear to require consideration of how methods of prevention or treatment are discovered and tested, as well as consideration of questions about how health care can be, or is, provided. Examination of the provision of health care would, no doubt, direct attention to institutes and researchers, clinicians, what profit-making enterprises each can, or should, play, both generally in the provision of health care and particularly in the development of new methods of prevention or treatment. roles government, research At least some of the questions which have been identified may not be readily answered without a very wide and deep examination of these issues, including economic and political issues of a kind not well suited to resolution by reference only to evidence adduced by the parties to adversarial proceedings. In Hayne addition, some of the questions may permit, even require, making value judgments which lie beyond the scope of legal notions of public policy191. None of these difficulties need be confronted in this case. No "generally inconvenient" argument having been advanced, the question need not be considered further. Analogical reasoning Recognising that the question is whether a method of prevention or treatment of human disease is "a proper subject of letters patent according to the principles which have been developed for the application of s 6 of the Statute of Monopolies" must be accompanied by recognition of an important consequence of framing the question in this way. Analogical reasoning lies at the heart of the judicial developments that have occurred over the years in the application of s 6 of the Statute of Monopolies and, in particular, the phrase "manner of manufacture". It is this form of reasoning which has underpinned the judicial expansion192 of the class of subjects identified as falling within the phrase "manner of manufacture" and thus as a proper subject for the grant of a patent. The phrase "manner of manufacture" has had to be considered in its application to inventions. By hypothesis, then, the phrase has had to be considered in its application to scientific and technological developments that not only were unknown at the time of the Statute of Monopolies, but also were unknown before the time when the phrase had to be applied. That being so, it is hardly surprising that "[i]n the varying applications of which the word 'manufacture' is capable analogy has always played a considerable part"193. But there are limits to the proper use of analogical reasoning. In particular, care must be exercised194 lest argument by analogy become no more than a process of adding words used in reasons for judgment in one case to the words of some other judgment to yield the asserted new outcome. And the care that must be exercised is against pushing what was said in those reasons about the concepts embraced by the phrase "manner of manufacture" to "the limit of its 191 cf Bristol-Myers Squibb Co v F H Faulding & Co Ltd (2000) 97 FCR 524 at 569 192 cf Maeder v Busch (1938) 59 CLR 684 at 706 per Dixon J. 193 NRDC Case (1959) 102 CLR 252 at 272. 194 cf Assistant Commissioner Condon v Pompano Pty Ltd (2013) 87 ALJR 458 at 490-491 [137]; 295 ALR 638 at 677; [2013] HCA 7. Hayne logic"195, or using those reasons like dominoes, "wherein every explanatory statement in a previous opinion is made the basis for extension to a wholly different situation"196. Such caution is always necessary in arguing by analogy. But it is especially necessary in considering whether a particular subject is a proper one for the grant of a patent. As Cardozo said197, "[s]ome conceptions of the law owe their existing form almost exclusively to history". What is a proper subject for the grant of a patent is a prime example of a legal conception of that kind. Adopting and adapting Cardozo's words198, it follows that the conception of what is a proper subject for the grant of a patent is not to be understood except as an historical growth. In the development of that conception, "history is likely to predominate over logic or pure reason"199. The dangers of verbal formulae In the NRDC Case, the Court said200 that: "The purpose of s 6, it must be remembered, was to allow the use of the prerogative to encourage national development in a field which already, in 1623, was seen to be excitingly unpredictable. To attempt to place upon the idea the fetters of an exact verbal formula could never have been sound. It would be unsound to the point of folly to attempt to do so now, when science has made such advances that the concrete applications of the notion which were familiar in 1623 can be seen to provide only the more obvious, not to say the more primitive, illustrations of the broad sweep of the concept." (emphasis added) What the Court said in the NRDC Case, about the patentability of a process, must be understood in this light. Nothing said in the Court's reasons for decision in that case can be taken as an exact verbal formula which alone 195 Cardozo, The Nature of the Judicial Process, (1921) at 51. 196 Friendly, "The Bill of Rights as a Code of Criminal Procedure", (1965) 53 California Law Review 929 at 950. See also Friendly, "'Some Kind of Hearing'", (1975) 123 University of Pennsylvania Law Review 1267 at 1300-1301. 197 The Nature of the Judicial Process, (1921) at 52. 198 The Nature of the Judicial Process, (1921) at 52. 199 The Nature of the Judicial Process, (1921) at 52. 200 (1959) 102 CLR 252 at 271. Hayne captures the breadth of the ideas to which effect must be given. And the same warning applies with equal force to the various expressions which are used in these reasons in the course of considering whether a method of prevention or treatment of human disease is a "manner of manufacture". Yet the cardinal features of the Court's decision in the NRDC Case are clear. For the purposes of this case, they are sufficiently indicated by considering the Court's discussion201 of the notion of a "vendible product", and "whether it is enough that a process produces a useful result or whether it is necessary that some physical thing is either brought into existence or so affected as the better to serve man's purposes". The NRDC Case and "vendible product" The Court's treatment of the notion of a "vendible product" in the NRDC Case is often summarised by reference to two propositions202: that the word "product" should be understood "as covering every end produced" and the word "vendible" treated "as pointing only to the requirement of utility in practical affairs" (emphasis added). Consistent, however, with the general injunction against treating a particular verbal formula as definitive, neither of these propositions can serve as a complete or sufficient premise for deductive reasoning to a conclusion about what is a "manner of manufacture" within the meaning of s 6 of the Statute of Monopolies for the purposes of s 18(1)(a) of the 1990 Act. In particular, it would be wrong to take the individual words of either of these phrases and ask only whether the word in question could properly be applied to the process in issue. Two points may be made in amplification and support of that proposition. First, several different words can be used to convey the ideas expressed by the understanding of "product" and "vendible" stated by the Court in the NRDC Case. "Product" can be described as a "result", an "outcome" or an "effect". It was described203 in the NRDC Case as "any physical phenomenon in which the effect, be it creation or merely alteration, may be observed". And "vendible" (treated as pointing only to the requirement of utility in practical affairs) was described204 as "some advantage which is material, in the sense that the process belongs to a useful art as distinct from a fine art", and as having "its value to the country ... in the field of economic endeavour". But both of these last two phrases must be understood in the context provided by the immediately 201 (1959) 102 CLR 252 at 270. 202 (1959) 102 CLR 252 at 276. 203 (1959) 102 CLR 252 at 276. 204 (1959) 102 CLR 252 at 275. Hayne preceding reference205 to "the expression 'vendible product' as laying proper emphasis upon the trading or industrial character of the processes intended to be comprehended by the Acts – their 'industrial or commercial or trading character'" (emphasis added). Second, and more fundamentally, it is of the first importance to recognise that the Court's treatment in the NRDC Case of the notion of a "vendible product" was directed to identifying whether the process in question was a proper subject for the grant of a patent. That issue was not treated206 as being determined by the conclusions that the process "was new, was not obvious, and was to be arrived at only by an exercise of scientific ingenuity, based upon knowledge and applied in experimental research". As the Court went on to say207, after reaching those conclusions about the particular process in issue, the "central question" in the case remained: whether that process fell within "the category of inventions to which, by definition, the application of the [1952 Act] is confined". The Court's discussion of the notion of a "vendible product" was directed to this central question. Utility lies at the heart of the answer the Court gave to the central question presented in the NRDC Case. But, as already noted, a particular kind of utility was identified208 ("utility in practical affairs"), and the "advantage" offered by a patentable process was described209 as lying in "its value to the country ... in the field of economic endeavour". The utility thus identified was to be found210 in the consequences of using the process (its product, result, outcome or effect). That is, the product, result, outcome or effect of the process (the description applied does not matter) had to be one having "utility in practical affairs". The breadth of application of the notion of "utility in practical affairs" need not be examined immediately. For present purposes, the critical observation to make is that the NRDC Case held that the patentability of a process depended upon the result, outcome or effect of the process (its product) having a particular characteristic (described by the expression "utility in practical affairs"). But, as will later be explained, subsequent cases shifted attention from 205 (1959) 102 CLR 252 at 275. 206 (1959) 102 CLR 252 at 268. 207 (1959) 102 CLR 252 at 268. 208 (1959) 102 CLR 252 at 276. 209 (1959) 102 CLR 252 at 275. 210 (1959) 102 CLR 252 at 277. Hayne whether the result, outcome or effect of the process had the characteristic of "utility in practical affairs" to the quite distinct issue of whether the process was one capable of economic exploitation. Subsequent cases asked: would people be prepared to pay to use the process? That is, the inquiry about economic advantage or value shifted from the product (the result, outcome or effect) of the process to whether the process itself could be exploited commercially. That shift in reasoning was not expressly acknowledged. Rather, as again will later be explored further in these reasons, the reasoning employed in the subsequent cases was said to be consistent with, even supported by, this Court's decision in the NRDC Case. Yet this Court did not hold in the NRDC Case that a process was a proper subject for the grant of a patent simply because it was a process which people would be prepared to pay to use. Methods of prevention or treatment of human disease Whether a method of prevention or treatment of human disease is a proper subject for the grant of a patent must be examined with these considerations in mind. It is convenient to begin that examination by looking at what has been said in decided cases about the subject. In particular, reference must be made to three English cases – C & W's Application211, London Rubber212 and Schering213 – which established, or at least accepted, the proposition that a method of prevention or treatment of human disease is not a proper subject for the grant of a patent. Reference must also be made to the two decisions of this Court which point towards acceptance of the same proposition (Maeder v Busch214 and the NRDC Case215) and to a third, single Justice, decision of this Court (Joos216) which points in the opposite direction. Finally, reference must be made to the two decisions of the Full Court of the Federal Court upon which the Full Court relied in this matter: Rescare217 and Bristol-Myers218. 211 (1914) 31 RPC 235. 212 [1968] RPC 31. 213 [1971] 1 WLR 1715; [1971] 3 All ER 177. 214 (1938) 59 CLR 684. 215 (1959) 102 CLR 252. 216 (1972) 126 CLR 611. 217 (1994) 50 FCR 1. 218 (2000) 97 FCR 524. Hayne It is useful to deal with the cases in chronological order of decision. Consideration of the cases in that order will reveal that the decision in Schering marked the shift in reasoning that has already been noted. Before Schering, a necessary element in demonstrating that a process was a proper subject for the grant of a patent was that the process yielded a product (a result, outcome or effect) which could be exploited commercially. Schering conflated the process and its product in considering the question of commercial exploitation. It decided that a process for treatment of the human body, not directed to prevention or cure of disease, was patentable if the process achieved a result for which people would be expected to be prepared to pay. That is, Schering decided that it was enough to show that the process (as distinct from the product, result, outcome or effect of its use) was a process that could be exploited commercially. The correctness of that shift in reasoning is critical to whether a method of prevention or treatment of human disease is a proper subject for the grant of a patent. C & W's Application In 1914, the Solicitor-General, Sir Stanley Buckmaster, concluded219, in C & W's Application, that a process for extracting metals, including lead, from the human body was not a proper subject for the grant of a patent. In the course of his reasons, the Solicitor-General noted220 that the Patent Office had "based their refusal [of the patent] upon the ground that the alleged invention relates simply to medical treatment". The Solicitor-General went on to say221 that he thought that the foundation for the refusal was "sound". It is important, however, to notice that the Solicitor-General did not confine his reasoning to endorsing the soundness of this Patent Office practice. Rather, the foundation for the conclusion expressed in C & W's Application was that the process was not (or perhaps was not sufficiently) "associated with commerce and trade"222. More particularly, the process was not one that could be "used in making something that is, or may be, of commercial value"223 (emphasis added). 219 (1914) 31 RPC 235. 220 (1914) 31 RPC 235 at 236. 221 (1914) 31 RPC 235 at 236. 222 (1914) 31 RPC 235 at 235. 223 (1914) 31 RPC 235 at 236. Hayne The reference to "something that is, or may be, of commercial value" may very well have to be understood as proceeding from the premise that the product of a patentable process must be tangible. And, as has been noted earlier in these reasons, that is now seen to be too confined a view. But the conclusion reached in C & W's Application did not depend upon some distinction between tangible and intangible products of processes. Rather, the conclusion depended upon treating the achievement of some bodily improvement in the human being as taking an invented process for achieving that end beyond the bounds of a proper subject for the grant of a patent. Thus, the Solicitor-General said224: "So far as human beings are concerned, it cannot be suggested that the extraction of lead from their bodies is a process employed in any form of manufacture or of trade, though the human being may be a better working organism when the lead is extracted." And the various statements225 in the reasons reserving for later consideration whether a process of the kind in question, if applied to animals, might be patentable emphasised that the conclusion which the Solicitor-General reached depended upon giving determinative significance to the end which the patent claimed was achieved by application of the process. That end was an improvement in the health of the human body. The process for achieving that end, though novel and inventive, was not patentable because a human being is not an object of commerce and a process for improvement of the health of a human being does not yield a product (a result, outcome or effect) which is itself of commercial value. C & W's Application founded Patent Office practice in the United Kingdom for many subsequent years and corresponding practice in Australia. Maeder v Busch In Maeder v Busch226, this Court dismissed an appeal from orders made by the Supreme Court of South Australia227 consequent on that Court holding that patent claims for a process for producing permanent waves in human hair were invalid228 by reason of "prior public commercial user and want of novelty". In 224 (1914) 31 RPC 235 at 236. 225 (1914) 31 RPC 235 at 236. 226 (1938) 59 CLR 684. 227 Maeder v Busch [1937] SASR 542. 228 [1937] SASR 542 at 548. Hayne the course of argument in this Court, the Court raised229 the broader question of whether the process was a proper subject for the grant of a patent. Latham CJ and Dixon J expressly accepted230 that C & W's Application required the conclusion that a process for prevention or treatment of human disease was not a proper subject for the grant of a patent. The issue raised by the Court was whether that proposition entailed that a process for improving the appearance of the human body, or ameliorating its condition, was patentable. Because of the conclusions reached on other issues, this broader question was not decided. But the dicta of Dixon J, in particular, are instructive. The central point made231 by Dixon J was that "[t]he application of a process or method of treatment to part of the human body for the purpose of improving its appearance or ameliorating its condition is distinguished from processes which may form the subject of patentable invention in aim and result". The aim of the process was described232 as "the alteration of some state or condition, feature or attribute belonging temporarily or permanently to a person"; the result233 "may be an improvement in his or her physical welfare or an increase in his or her pride of appearance". That is, the aim was to alter the state or condition of the human body; the result intended may be either therapeutic or cosmetic. But the aim and the result, together, were seen as taking a process of either kind (therapeutic or cosmetic) beyond the proper scope for the grant of a patent. Dixon J acknowledged234 that "[t]he purpose of the patentee and those intended to employ the process may be entirely commercial" and that the process "may be intended for use in ordinary trade or business". Dixon J also acknowledged235 that its purpose may instead "be the relief of suffering by surgical or manipulative means". But Dixon J pointed out236 that in none of the cases described was the object "to produce or aid the production of any article of 229 See "New Zealand Letter", (1943) 16 Australian Law Journal 274. 230 (1938) 59 CLR 684 at 699, 706. 231 (1938) 59 CLR 684 at 706. 232 (1938) 59 CLR 684 at 706. 233 (1938) 59 CLR 684 at 706. 234 (1938) 59 CLR 684 at 706. 235 (1938) 59 CLR 684 at 706. 236 (1938) 59 CLR 684 at 706. Hayne commerce". "No substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence by means of or with the aid of the process."237 Maeder v Busch cannot be treated as deciding this issue; the case was decided on other grounds. The dicta of Dixon J must be read, no doubt, in the context provided by all that his Honour said. In particular, Dixon J noted238 that "a widening conception of a manner of new manufacture has been a characteristic of the growth of patent law", and expressly left239 undecided whether, as the plaintiff had submitted, a process for treating the hair may be held to be patentable on the basis that the hair was "an adjunct which plays no part in the vitality of the body". Much has already been said in these reasons about the NRDC Case. Particular attention has already been directed to the notable advancements made in that case about the question which is to be asked in considering the application of s 6 of the Statute of Monopolies to new processes. For immediate purposes, however, it is necessary to notice two statements made by the Court in the NRDC Case that have not already been mentioned. First, the Court said240 that certain statements made in R v Wheeler241 required qualification "even if only in order to put aside, as they apparently must be put aside, processes for treating diseases of the human body", and referred in that regard both to C & W's Application and to Maeder v Busch. Second, the Court said242 that "[t]he exclusion of methods of surgery and other processes for treating the human body may well lie outside the concept of invention because the whole subject is conceived as essentially non-economic", and in that regard referred to the reasons of Dixon J in Maeder v Busch243. 237 (1938) 59 CLR 684 at 706. 238 (1938) 59 CLR 684 at 706. 239 (1938) 59 CLR 684 at 707. 240 (1959) 102 CLR 252 at 270. 241 (1819) 2 B & Ald 345 at 349, 350 [106 ER 392 at 394, 395]. 242 (1959) 102 CLR 252 at 275. 243 (1938) 59 CLR 684 at 706. Hayne No doubt, both of these statements in the NRDC Case are properly seen as parenthetical interjections in the Court's reasoning. But both are wholly consistent with the reasoning and conclusion in respect of the immediate issue for decision in that case. In particular, the reference to "the whole subject" of "methods of surgery and other processes for treating the human body" as "essentially non-economic" serves to explain why a process for eradicating weeds from arable land is patentable but a process for preventing or treating human disease is not. Eradicating weeds from arable land is a process "that offers some advantage which is material, in the sense that ... its value to the country is in the field of economic endeavour"244. As these reasons will show, a process for prevention or treatment of human disease may well be capable of commercial exploitation, but it produces no outcome which is capable of commercial exploitation. London Rubber London Rubber Industries Ltd sought a patent for a process of birth control by oral administration of known hormonal drugs. The Comptroller refused the application. On appeal to the Patents Appeal Tribunal, Lloyd-Jacob J upheld the refusal, concluding245 that "the improvisation of a method of treating a human being cannot in reason be regarded as affording proper subject matter for letters patent". This conclusion, his Lordship considered, followed from "the practice established in the Patent Office for upwards of the past fifty years of refusing grant to forms of medical treatment of the human body"246, from the decision in C & W's Application, and from this Court's decisions in Maeder v Busch and the NRDC Case. The reference made247 in the NRDC Case to putting aside "processes for treating diseases of the human body", coupled with the reference in the NRDC Case to Maeder v Busch, was taken248 by Lloyd-Jacob J to show that a process for treating diseases of the human body is not patentable because "(a) the object is not to produce or aid in the production of any article of commerce; [and] (b) no substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence by means of or with the aid of the process". 244 (1959) 102 CLR 252 at 275. 245 [1968] RPC 31 at 35. 246 [1968] RPC 31 at 34. 247 (1959) 102 CLR 252 at 270. 248 [1968] RPC 31 at 34-35. Hayne Schering Schering AG sought a patent claiming a method of contraception comprising the administration of gestagen in doses sufficient to prevent conception but not such as to suppress ovulation. The superintending examiner refused the application and Schering AG appealed to the Patents Appeal Tribunal. The Tribunal (Graham and Whitford JJ) allowed the appeal. The question for the Tribunal, as it had been for the Patent Office, was whether it was plain that there was no patentable subject matter. That is, as the Tribunal framed the question: was there "no reasonable doubt that a manner of manufacture [was] not being claimed"249? The immediate basis for the decision to allow the appeal was that, although "patents for medical treatment in the strict sense must be excluded ..., the claims the subject of the application do not appear to fall within this prohibition"250 because the method of treatment claimed was not a treatment to cure or prevent disease. Whitford J, giving the reasons of the Tribunal, said251: "Unless any treatment of the human body, as opposed to medical treatment to cure or prevent disease, is to be considered as being outside the scope of patent protection, there seems to be no reason why such a claim [to avoid or suppress conception] should not be allowed. The process is in the field of the useful as opposed to the fine arts. It is of commercial significance because it will produce a result which people are going to be prepared to pay for and which is widely considered desirable in the present climate of public opinion. It ought to be protected if it is, as must be accepted for present purposes, of inventive merit and because it is a process which others no doubt would be only too anxious to adopt, if they could, without paying tribute to anyone." (emphasis added) This reasoning constituted a sharp, albeit unacknowledged, departure from the reasoning of Lloyd-Jacob J in London Rubber. In Schering, the focus was upon whether people would be prepared to pay for the process to achieve the intended result. By contrast, in London Rubber, the question critical to patentability had been seen as whether the process yielded a product (a result, outcome or effect) which was capable of commercial exploitation. 249 [1971] 1 WLR 1715 at 1723; [1971] 3 All ER 177 at 183. 250 [1971] 1 WLR 1715 at 1723; [1971] 3 All ER 177 at 183. 251 [1971] 1 WLR 1715 at 1722; [1971] 3 All ER 177 at 182-183. Hayne To say that the result of the process in issue in Schering (prevention of conception) was "a result which people are going to be prepared to pay for"252 was to answer a question which was directed only to whether the process was one which may be exploited commercially. But as the decision of Lloyd-Jacob J in London Rubber shows253, questions of commercial exploitation were seen, until Schering, as directed to the nature of the end produced by the process in question, not simply whether people would be prepared to pay to use the process. Unlike the absence of weeds in an arable field (which can be exploited commercially by yielding a better harvest), the absence of human conception is an end produced which cannot be exploited commercially. In Joos254, Barwick CJ considered a patent claiming a process for improving the strength and elasticity of keratinous material, especially human hair and nails. The Deputy Commissioner of Patents had decided255 that the application should not proceed because it "claimed as an invention a process for the treatment of parts of the human body". Mr Joos appealed to this Court. As in Schering, the question for this Court was256 whether what was claimed could be regarded as a proper subject for the grant of a patent. Could the Commissioner of Patents, "properly directing himself, ... reasonably hold that there was no reasonable doubt as to the invention being outside the [Statute of Monopolies], that is to say, that the application was plainly without possible justification"257? Barwick CJ decided that the application was not without possible justification and allowed the appeal. In his reasons, Barwick CJ began258 his consideration of the issues "at the point which is reached by the Court's decision" in the NRDC Case. For the purposes of argument, Barwick CJ accepted259 that "a process for the treatment of 252 [1971] 1 WLR 1715 at 1722; [1971] 3 All ER 177 at 183. 253 [1968] RPC 31 at 34-35. 254 (1972) 126 CLR 611. 255 (1972) 126 CLR 611 at 615. 256 (1972) 126 CLR 611 at 615. 257 (1972) 126 CLR 611 at 615. 258 (1972) 126 CLR 611 at 618-619. 259 (1972) 126 CLR 611 at 619. Hayne the human body as a means of curing or preventing a disease, correcting a malfunction or removing or ameliorating an incapacity is not a proper subject matter for the grant of a monopoly under the [1952] Act" (emphasis added). And although Barwick CJ said260 that it was not essential to the decision of the matter "to controvert that proposition or to discover and express its basis in law", his Honour did say261 that if he "had to do so ... [he] would place the exception, if it is to be maintained, on public policy as being, in the language of the Statute of Monopolies, 'generally inconvenient'". It is important to notice that Barwick CJ considered262 that there is a "relevantly radical" distinction between "a process for treating the diseases of the body and a process for improving the cosmetic appearance of the body". The proposition which his Honour accepted for the purposes of argument was one narrowly confined to processes for the therapeutic, as distinct from the cosmetic, treatment of the human body. And Barwick CJ concluded263 that a process for the cosmetic treatment of the human body could lawfully be the subject of a patent under the 1952 Act. The Commissioner, as respondent to the appeal, had submitted264 that the "process fails to have economic significance because it is for treating parts of the human body". By contrast, the appellant had submitted265 that the test for the patentability of a process had two elements: "first that the process must have as its end result an artificial effect or an artificially created state of affairs which may be considered to be the 'product' of a process, and secondly that the product must have a significance which is economic or has an industrial, commercial or trading character". (emphasis added) the this Commissioner's submission "involved ... a misconception of what is meant by the issue briefly, holding that 260 (1972) 126 CLR 611 at 619. 261 (1972) 126 CLR 611 at 623. 262 (1972) 126 CLR 611 at 618. 263 (1972) 126 CLR 611 at 622-623. 264 (1972) 126 CLR 611 at 614. 265 (1972) 126 CLR 611 at 613. 266 (1972) 126 CLR 611 at 623-624. Hayne need for the invention to be in the commercial field". But the nature of the supposed misconception was not expressly identified in (indeed, it appears directly opposed to) the appellant's argument and is apparent only from consideration of what Barwick CJ had said earlier in his reasons about the NRDC Case and about Schering. Barwick CJ had said267 that whilst the NRDC Case "made it plain that the claimed process, in order to be an invention, need not by its use result in the production or improvement of a vendible article, this Court did emphasize the need for the claimed process to have a commercial application" (emphasis added). Barwick CJ had also acknowledged268 that a process, to be patentable, "must be one that offers some advantage which is material, in the sense that the process belongs to a useful art as distinct from a fine art". But the necessary "economic value" of the process was said269 "not always [to] be directly supplied by the nature of the activity which would utilise the process". And Barwick CJ did not identify270 the decision in Schering as departing in any respect from what had been decided by this Court in the NRDC Case. Rather, Schering was treated as supporting the distinction which Barwick CJ drew between medical treatment of disease and other forms of treatment of the human body. The statement that a process must have "a commercial application" is ambiguous. It does not distinguish between the commercial exploitation of the process and the commercial exploitation of the product (the result, outcome or effect) of that process. Thus, when Barwick CJ referred271 to the "commercial activity of hairdressing" and to that sector accounting "for a great deal of employment", the references were evidently intended to describe a commercial application for the process in the sense that it was a process for which people would be prepared to pay in connection with a commercial venture. Barwick CJ gave no express consideration to whether the product of that process could be exploited commercially by turning that product to economic advantage or account, instead treating "indirect" economic advantage as sufficient. 267 (1972) 126 CLR 611 at 623. 268 (1972) 126 CLR 611 at 624. 269 (1972) 126 CLR 611 at 624. 270 (1972) 126 CLR 611 at 621-622. 271 (1972) 126 CLR 611 at 624. Hayne Although reference was made272 to the "obvious" "national economic interest in the product of good surgery" (emphasis added), that reference must be understood in the light provided by the emphasis given by Barwick CJ to the commercial application of the process. And it must also be understood in the light provided by the observation273 that there was no difficulty in "conceding, for the purpose of the decision [in Joos], that a process for the medical treatment of a part of the human body is not a proper subject of letters patent". Hence, like Schering, the decision in Joos depended upon discarding the requirement, identified in the NRDC Case, that a process produce a product (a result, outcome or effect) which could itself be turned to commercial advantage. And it discarded that requirement without explanation. The state of authority after Joos The subsequent decisions of the Federal Court in Rescare274 and Bristol-Myers275 must be understood in light of the then state of authority. This Court had not decided whether a method of prevention or treatment of human disease was a proper subject for the grant of a patent. In Maeder v Busch, and in the NRDC Case, the Court had assumed that it was not. In Joos, Barwick CJ, sitting as a single Justice, had assumed for the purposes of argument that it was not, but had decided the case in a way which depended upon a distinction between therapeutic and cosmetic treatment which, despite his Honour's expressed276 view to the contrary, was convincingly shown277, in Rescare, to be difficult to maintain. And, most importantly, in Joos, Barwick CJ had made the same critical shift in reasoning which had been made in Schering. If attention is focused, as it was in Schering and in Joos, on whether the process (as distinct from its product) can be exploited commercially, no logically defensible justification for deciding that a method of prevention or treatment of human disease is not a proper subject for the grant of a patent is readily discerned. It is, then, unsurprising that the Federal Court decided Rescare and Bristol-Myers as it did. 272 (1972) 126 CLR 611 at 618. 273 (1972) 126 CLR 611 at 619. 274 (1994) 50 FCR 1. 275 (2000) 97 FCR 524. 276 (1972) 126 CLR 611 at 622-623. 277 (1994) 50 FCR 1 at 19 per Lockhart J. Hayne Rescare In Rescare, both at first instance278, and on appeal to the Full Court of the Federal Court279, extensive consideration was given to the patentability of a process for the treatment of obstructive sleep apnoea. Although the case was decided on other issues, both at trial and on appeal, the general tenor of the decisions of Gummow J (at trial) and the majority of the Full Court (Lockhart and Wilcox JJ, Sheppard J dissenting) was that a process for the treatment of human disease is a proper subject for the grant of a patent. In each of the judgments, both at trial and on appeal, there was a close analysis of the decided cases, both in Australia and elsewhere. It is sufficient to refer to the discussion of those matters in those judgments without traversing that ground again in these reasons. At trial, Gummow J took three critical steps. First, he treated280 the NRDC Case as establishing "that it is not essential for the grant of a monopoly for a process that the use of the process should produce or improve a vendible article". Rather, in words evidently adopted from the reasons of Barwick CJ in Joos, Gummow J said281 that "[i]t is enough that the process has a commercial application". Second, Gummow J held282 that, under the 1952 Act, "there was no normative distinction to be drawn between those processes for treatment of the human body for disease, malfunction or incapacity, and for cosmetic purposes". Third, Gummow J expressed283 agreement with the suggestion, made284 by Barwick CJ in Joos, that any continued exclusion of methods of prevention or treatment of human disease from patentability should be based on the "generally inconvenient" exception to s 6 of the Statute of Monopolies and public policy. Accordingly, Gummow J concluded285 that the attack which had been mounted on certain of the claims (as not being proper subjects for the grant of a patent) failed. 278 Rescare Ltd v Anaesthetic Supplies Pty Ltd (1992) 111 ALR 205. 279 Anaesthetic Supplies Pty Ltd v Rescare Ltd (1994) 50 FCR 1. 280 (1992) 111 ALR 205 at 233. 281 (1992) 111 ALR 205 at 233. 282 (1992) 111 ALR 205 at 239. 283 (1992) 111 ALR 205 at 237. 284 (1972) 126 CLR 611 at 623. 285 (1992) 111 ALR 205 at 239. Hayne On appeal, Lockhart J said286 that there was "no justification in law or in logic to say that simply because ... substances produce a cosmetic result or a functional result as opposed to a curative result, one is patentable and the other is not". Accordingly, Lockhart J concluded287 that there was "no reason in principle why a method of treatment of the human body is any less a manner of manufacture than a method for ridding crops of weeds" as in the NRDC Case. Yet, despite reaching this opinion, Lockhart J said288 that it was not necessary to deal with the arguments advanced on the ground of "generally inconvenient". How that could be was not explained. The other member of the majority in the Full Court, Wilcox J, considered289 that the NRDC Case had held that "it is enough to support a patent that the subject process produce a useful result", and this, in his Honour's view, "swept away" the rationale of C & W's Application. Central, then, to the decision in Rescare, both at trial and on appeal, was the conclusion that a process was a proper subject for the grant of a patent so long only as the process produced a "useful" result in the sense that the result was one for which it may be expected that people will be prepared to pay. That is, the statements made in Rescare about the patentability of processes for the prevention or treatment of human disease depend upon the shift in reasoning that was made first in Schering and then in Joos. Bristol-Myers In Bristol-Myers, the Full Court of the Federal Court (Black CJ, Lehane and Finkelstein JJ) held that a method of medical treatment of the human body was a proper subject for the grant of a patent. The plurality (Black CJ and Lehane J) followed290 the decision in Rescare and said291 that they were fortified in their decision to do so by two considerations. The first was identified292 as being "the insurmountable problem, 286 (1994) 50 FCR 1 at 19. 287 (1994) 50 FCR 1 at 19. 288 (1994) 50 FCR 1 at 19. 289 (1994) 50 FCR 1 at 43. 290 (2000) 97 FCR 524 at 529 [15]. 291 (2000) 97 FCR 524 at 529-530 [15]. 292 (2000) 97 FCR 524 at 530 [15]. Hayne from a public policy viewpoint, of drawing a logical distinction which would justify allowing patentability for a product for treating the human body, but deny patentability for a method of treatment" (original emphasis). The second was described293 as "the very limited extent to which the Parliament dealt with patents with respect to the human body when it enacted the 1990 Act, bearing in mind, too, that it did so at a time when the long-standing practice in Australia was (as we are informed it still is) to grant patents for methods of medical treatment of the human body". The third member of the Court, Finkelstein J, considering the matter afresh, decided294 that "medical treatment and surgical process are patentable under the legislation and, if public policy requires a different result, it is for the Parliament to amend the 1990 Act". The questions presented by the cases Several questions arise from the cases that have been discussed. They can be identified as follows. First, what is to be made of: (a) the absence of any provision dealing directly with the patentability of methods of medical treatment; (b) the provision of s 18(2) of the 1990 Act that "[h]uman beings, and the biological processes for their generation, are not patentable inventions", and the provision by s 119A of infringement exemptions for certain acts in respect of a "pharmaceutical patent"; and (c) the practice of granting patents for methods of treatment of the human body? Second, can a distinction properly be made between allowing patentability for a product for treatment of the human body, but denying patentability for a method of treatment? Third, is a process a proper subject for the grant of a patent under the 1990 Act only if it results in a product (a result, outcome or effect) which can be exploited commercially? Fourth, if a process is a proper subject for the grant of a patent only if it results in a product (a result, outcome or effect) which can be exploited commercially, does a method of prevention or treatment of human disease meet that requirement? 293 (2000) 97 FCR 524 at 530 [16]. 294 (2000) 97 FCR 524 at 569 [142]. Hayne Although the third and fourth questions are the more fundamental of the questions identified, it is convenient to deal with the questions in the order in which they are stated, and to dispose of the first two questions relatively briefly. Legislative silence in the face of past practice? No provision of the 1990 Act provides directly for whether a method of medical treatment is a proper subject for the grant of a patent. At the time of enactment of the 1990 Act, there was no decision of this Court that methods of medical treatment were not patentable. Maeder v Busch and the NRDC Case pointed against patentability, but the decision of Barwick CJ in Joos provided ample basis for argument about the question. It is, then, unsurprising that, both before and after the enactment of the 1990 Act, patents for methods of medical treatment had been granted. It has not been clear beyond argument that claims of that kind cannot be regarded as a proper subject for the grant of a patent. The practice of granting patents for such claims that has emerged must be understood as indicating no more than that a claim for a method of prevention or treatment of human disease is not unarguably bad. If the 1990 Act had said expressly whether a method of prevention or treatment of human disease is a proper subject for the grant of a patent, the question would have been put beyond doubt. But no provision of that kind was made. As Gummow J noted295 in Rescare, the recommendation which the Industrial Property Advisory Committee made296 to government, evidently accepted and given effect in the 1990 Act, was that the "threshold test of patentability", by reference to the expression "manner of new manufacture" and s 6 of the Statute of Monopolies, be retained in the patent legislation without specific legislative inclusions or exclusions. The question of patentability of methods of prevention or treatment of human disease therefore remained unresolved by express statutory provision directed specifically to its resolution. The question must now be answered by this Court. Nothing can usefully be made of the absence from the 1990 Act of provisions dealing expressly with the patentability of a method of prevention or treatment of human disease. There is nothing in the 1990 Act itself, or in extrinsic materials which might be relevant to its construction, which provides any foundation for inferring from the absence of express provisions about the matter that one construction or application of the 1990 Act should be preferred over another. The absence of express provision about the subject means no more 295 (1992) 111 ALR 205 at 234. 296 Commonwealth, Industrial Property Advisory Committee, Patents, Innovation and Competition in Australia, (1984) at 41. Hayne than that the questions of construction and application of the general provisions of the 1990 Act remain. What, if anything, is to be made of s 18(2) or s 119A? Neither party suggested that s 18(2) of the 1990 Act speaks directly to the issues in this appeal and it does not. It may be put aside from consideration. Section 119A(1) was inserted into the 1990 Act in 2006297. It provides that the rights of a patentee of a "pharmaceutical patent" are not infringed by a person exploiting an invention claimed in the patent if the exploitation is solely for purposes connected with obtaining inclusion in the ARTG of certain goods intended for therapeutic use, or for purposes connected with obtaining similar regulatory approval under a foreign law. A "pharmaceutical patent" is defined298 as (among other things) a patent claiming "a method, use or product relating to a pharmaceutical substance" (emphasis added). Contrary to the respondents' submissions, s 119A provides no assistance in the resolution of the issue of patentability. The definition of "pharmaceutical patent" in s 119A(3), and the provisions of s 119A generally, recognise that there are patents which claim a method of treatment of human disease. That is, s 119A recognises the practice that had emerged, before s 119A was inserted into the 1990 Act, of granting patents for methods of medical treatment. But, by providing that certain steps taken to obtain inclusion of a product on the ARTG do not infringe the rights of the patentee, s 119A neither directly nor indirectly assists in resolving the issue of patentability that is presented by the application of s 18(1) of the 1990 Act. In particular, statutory recognition that patents for methods of prevention or treatment of human disease have been granted says nothing about whether those grants are valid. It is not necessary, in these circumstances, to explore the difficulties involved in using the amendment made to the 1990 Act after the grant of the patent in suit to construe the provision of that Act under which the patent in suit was granted299. The second of the matters relied on by Black CJ and Lehane J in Bristol-Myers as fortifying their conclusion that methods of medical treatment are patentable should be put aside. 297 Intellectual Property Laws Amendment Act 2006 (Cth), s 2, Sched 7, item 3. 298 s 119A(3). 299 cf Grain Elevators Board (Vict) v Dunmunkle Corporation (1946) 73 CLR 70 at 85-86; [1946] HCA 13; Hunter Resources Ltd v Melville (1988) 164 CLR 234 at 254-255; [1988] HCA 5; Hepples v Federal Commissioner of Taxation (1992) 173 CLR 492 at 539; [1992] HCA 3; Commissioner of State Revenue (Vict) v Pioneer Concrete (Vic) Pty Ltd (2002) 209 CLR 651 at 669 [51]-[52]; [2002] HCA 43. Hayne Distinguishing between patentability of pharmaceutical substances and methods of treatment There is no doubt that a pharmaceutical substance useful for preventing or treating disease in humans is a proper subject for the grant of a patent under the 1990 Act. Opinions differ about whether, and to what extent, granting a monopoly over exploitation of newly discovered substances which prevent or treat human disease, and thus alleviate human suffering, is sound public policy. Those differences of opinion are reflected in the different forms of legislative provision for such matters that have been made by various nations. And those differences of opinion reflect differing judgments made about the costs and benefits of providing for a monopoly and the moral or ethical issues which may be thought to be presented. If patentability of a method of prevention or treatment of human disease depended upon a public policy judgment which was informed by moral or ethical considerations, it seems probable that the moral or ethical issues presented would be the same as those which relate to the patentability of pharmaceutical substances. On the face of things, it would be difficult to justify answering those particular issues differently in respect of a method of treatment from the answers given in respect of a pharmaceutical substance. But the costs and benefits of providing a monopoly in respect of a pharmaceutical substance may very well differ from the costs and benefits of providing a monopoly over a method of prevention or treatment of human disease. The costs of discovering new pharmaceutical substances are typically very high and very many new pharmaceutical substances are discovered by large commercial enterprises engaged in extensive and expensive research programs. In addition, the costs of testing those pharmaceutical substances and bringing them to market are very high. It is not self-evident, however, that new methods of prevention or treatment of human disease are typically discovered in circumstances sufficiently similar to those which obtain in respect of the discovery of new pharmaceutical substances to attribute the same balance of costs and benefits to the grant of a monopoly over methods of treatment as may be struck in respect of the grant of a monopoly over new pharmaceutical substances. As noted earlier in these reasons, in connection with the question of "generally inconvenient", those are matters for demonstration, not assumption, and no demonstration of that proposition was attempted in this case. A logical tension, of the kind suggested300 by Black CJ and Lehane J in Bristol-Myers, between holding that pharmaceutical substances are patentable, 300 (2000) 97 FCR 524 at 530 [15]. Hayne and holding that methods of prevention or treatment of human disease are not, arises only if the considerations relevant to the two different cases are identical. As has been noted, it may be that identical moral or ethical issues are presented. But it is not to be assumed that the same costs and benefits apply in both cases. And unless the costs and benefits are the same, there is no necessary contrariety in holding that pharmaceutical substances are patentable but methods of prevention or treatment of human disease are not. It is not demonstrated that there is any logical tension if different outcomes are reached in the two cases. It may be noted that reference is made in these reasons to methods of prevention or treatment of human disease without attempting to distinguish between medical and surgical treatment. It is not necessary to decide whether some stable and clear distinction could be made between methods of treatment that are "medical" and other methods that are "surgical". It is as well to say, however, that there would seem to be no little difficulty in identifying criteria that could be used to draw such a boundary. It is also not necessary to decide whether some stable and clear distinction could be made between methods of treatment involving a hitherto unknown therapeutic use of a pharmaceutical substance and methods of treatment used by doctors or others in the course of treating patients. It would seem, however, very hard to draw any line between those methods according only to who developed them. It cannot be assumed that new methods of medical treatment are discovered only by large commercial enterprises or that only an enterprise of that kind could or would seek to profit from the discovery of a new and useful method of prevention or treatment of human disease. The distinction posited assumes, but does not demonstrate, that only some kinds of methods of treatment can be practically applied in commerce. There remain for consideration the two questions which lie at the heart of whether a method of prevention or treatment of human disease is a proper subject for the grant of a patent. Must a process, to be patentable, yield a product (a result, outcome or effect) which can be exploited commercially? If it must, does a method of prevention or treatment of human disease yield a product of that kind? Economic significance of process or product? The NRDC Case emphasised301 the economic significance and utility of the product of the process considered in that case. As noted earlier in these reasons, there are to be found in the reasons of Barwick CJ in Joos302, and those 301 (1959) 102 CLR 252 at 277. 302 (1972) 126 CLR 611 at 617. Hayne of Gummow J at first instance in Rescare303, statements to the effect that the NRDC Case established that the claimed process must have "a commercial application" if it is to be patentable. As also noted earlier, that proposition is ambiguous. It may refer to "commercial application" in the sense of either commercial exploitation of the process, or commercial exploitation of the product (the result, outcome or effect) of the process. The further logical possibility that the expression should be understood as encompassing either form of commercial exploitation may be acknowledged but should be put aside from consideration. It may be put aside because, if the product of the process can be exploited commercially, it follows inevitably that the process itself can be. For present purposes, attention must be confined to the first of the two possible meanings identified. It is that meaning which was adopted and applied in Schering and in Joos. It is that meaning which underpins the decisions in Rescare and Bristol-Myers. A person who has the exclusive right304 to use any process which is novel305, involves an inventive step306 and is useful307 can command a price for exploiting308 the process by using it. The price that can be charged will depend, no doubt, upon the utility309 of the process to its user. If the process yields a product which can be exploited commercially, the price for use of the process will be affected by the market price for the resulting product. But even if there is no marketable product of the process, the extent to which users consider the process to be useful (for any reason, commercial or not) will determine its price. And the process is thus capable of commercial exploitation because it is novel, involves an inventive step and is useful. As Joos demonstrates, a process for alteration of the state of the human body (in that case, a process for altering the condition of human hair and nails) can be exploited commercially even though the process yields no more than a 303 (1992) 111 ALR 205 at 233. 305 s 18(1)(b)(i). 306 s 18(1)(b)(ii). 307 s 18(1)(c). 308 Sched 1, definition of "exploit", par (b). 309 See, for example, Fawcett v Homan (1896) 13 RPC 398 at 405 per Lindley LJ; Rehm Pty Ltd v Websters Security Systems (International) Pty Ltd (1988) 81 ALR Hayne temporary change thought to be aesthetically desirable. Likewise, a person who has the exclusive right to use a method of prevention or treatment of human disease which is novel, involves an inventive step and is useful can command a price for use of that method. The price which that person can charge depends upon the utility of the method (limited, no doubt, by the capacity and preparedness of the payer to pay for its use). The method can be exploited commercially; it has "a commercial application". Two considerations point firmly against accepting that a process is a proper subject for the grant of a patent so long as it is a process which will "produce a result [for] which people are going to be prepared to pay"310. First, s 18(1) of the 1990 Act required that a patentable invention, so far as claimed in any claim, have five characteristics. It must311 be a manner of manufacture within the meaning of s 6 of the Statute of Monopolies. That is, it must be a proper subject for the grant of a patent. When compared with the prior art base as it existed before the priority date of that claim, it must312 be novel and it must313 involve an inventive step. It must314 be useful. It must315 not have been secretly used in the patent area before the priority date of that claim. To hold that a process is patentable if the process is one for which people are likely to be prepared to pay would result in treating the first of these requirements as superfluous. The requirement that the process be a "manner of manufacture" would inevitably be satisfied by demonstration of the second and fourth requirements of novelty and utility. Because the process is novel and useful, it is a process for which people will be prepared to pay. Second, and no less importantly, the whole history of the development of the law in this Court, until the decision in Joos, was that, for a process to be patentable, the product (the result, outcome or effect) of that process, as distinct from the process itself, must have a particular characteristic. And in that respect, the decisions of this Court mirrored the development of the law of patents that had occurred in England and Wales. At first described as a requirement for a vendible product, that characteristic was enlarged in its application by the various 310 Schering [1971] 1 WLR 1715 at 1722; [1971] 3 All ER 177 at 183. 311 s 18(1)(a). 312 s 18(1)(b)(i). 313 s 18(1)(b)(ii). 314 s 18(1)(c). 315 s 18(1)(d). Hayne descriptions given to it in the NRDC Case: "some advantage which is material"316; "value to the country ... in the field of economic endeavour"317; "utility in practical affairs"318; "the significance of the product is economic"319; and possessing "its own economic utility"320. But none of these amplifying expressions can be read as discarding the requirement that the "new and useful effect" observed321, the "end produced"322, the "artificial effect" or "artificially created state of affairs, discernible by observ[ation]" produced323, or "separate result" produced324 by the process, be of a character that makes the process a proper subject for the grant of a patent. This requirement that, for a process to be patentable, the product (the result, outcome or effect) of that process, as distinct from the process itself, must have a particular characteristic is one that should not now be discarded as irrelevant. Discarding it may possibly be justified as a logical extension of what has been said in earlier cases about the commercial purposes325 of the patent system. But, as already noted, an extension of that kind depends upon speaking of "a commercial application" in the abstract, without condescending to particular identification of whether it is the process or its product that is being applied in the realm of commerce. And even if taking that step can be justified in logic, it is one which, if taken, would sever what is a proper subject for the grant of a patent from its historical roots. Any process, whatever its application and whatever may be the result of its use, would be a proper subject for the grant of a patent if it were novel and useful. No case decided before the NRDC Case took that step. The NRDC Case did not take that step. This Court should not now do 316 (1959) 102 CLR 252 at 275. 317 (1959) 102 CLR 252 at 275. 318 (1959) 102 CLR 252 at 276. 319 (1959) 102 CLR 252 at 277. 320 (1959) 102 CLR 252 at 277. 321 (1959) 102 CLR 252 at 276. 322 (1959) 102 CLR 252 at 276. 323 (1959) 102 CLR 252 at 277. 324 (1959) 102 CLR 252 at 277. 325 See, for example, Bristol-Myers (2000) 97 FCR 524 at 568 [136] per Finkelstein J. Hayne What, then, is the nature of the product (the result, outcome or effect) of applying a method of prevention or treatment of human disease? The product of prevention or treatment of human disease There can be no doubt that a healthy population is in the national interest and is economically advantageous to the nation as a whole. As Barwick CJ "The national economic interest in the product of good surgery – and therefore in the advancement of its techniques – if in no other respect than the repair and rehabilitation of members of the work force, including management in that grouping, is ... obvious". (emphasis added) But it is important to recognise that these are propositions about the overall economic advantages of good health in the community. They are statements which appeal, at least implicitly, to comparisons over time or place between rich and poor societies and seek to assert and rely upon what, according to more recent economic history studies327, can be described as the "synergistic improvement of health and living standards"328. They are propositions which speak only of the overall or aggregate effect of improvements in the health of the population and neither assign any particular cause for any improvement in health, nor assess what are the costs or the benefits associated with whatever may have been the cause or causes for improvement. The question at issue in this case is more particular. It is whether using a method of prevention or treatment of human disease produces a result, an outcome or an effect which can be described in terms of the kind used in the NRDC Case. Can it be said that a method of preventing or treating a disease of the human mind or body, or "correcting a malfunction or removing or ameliorating an incapacity"329 of the human body, produces a result which could be described as: having "some advantage which is material"330; something of 326 (1972) 126 CLR 611 at 618. 327 Fogel and Costa, "A Theory of Technophysio Evolution, with Some Implications for Forecasting Population, Health Care Costs, and Pension Costs", (1997) 34 Demography 49. 328 Deaton, "The Great Escape: A Review of Robert Fogel's The Escape from Hunger and Premature Death, 1700-2100", (2006) 44 Journal of Economic Literature 106 329 Joos (1972) 126 CLR 611 at 619. 330 NRDC Case (1959) 102 CLR 252 at 275. Hayne "value to the country ... in the field of economic endeavour"331; having some "utility in practical affairs"332; having "significance ... [which] is economic"333; and possessing "its own economic utility"334? What a method of prevention or treatment of human disease produces in the individual to whom it is applied cannot be described in those terms. The method of treatment, if successful, prevents, reduces or eliminates some disease, discomfort or incapacity of the individual. The effect on the individual can be regarded as artificially created by the method of treatment. (No doubt, the individual must respond to the treatment and the treatment may very well depend upon responses which could be seen as naturally occurring in response to the treatment. For present purposes, however, no attention need be paid to those observations335.) The effect on the individual is undoubtedly useful to him or her. The effect may permit the individual better to exploit his or her capacities economically (whether by selling his or her labour or otherwise). In that way, the effect may be useful to society generally or to some section of it. It may enable the individual concerned to make a better and more valuable contribution to national production; it may reduce the costs to society which the individual may have caused in his or her previous state. In those ways, use of the process may have economic consequences for the individual and, according to that individual's choices, for the wider society. The effect of using the process is personal to the individual. It is not an effect which the person who owns the right to use the process, or any person other than the individual who has been treated, can turn to economic account in any way, whether directly or indirectly. If the individual who has been treated can turn the effect to economic account, he or she can do so only indirectly: by taking advantage of better health to make a more valuable contribution to national production. The individual is not a subject of commerce. The product of the process in the individual (having better health than might otherwise have been the case) cannot be sold. Absence of the product (of good or better health) may be a cost to the individual and a cost to society. Relief from that cost by 331 (1959) 102 CLR 252 at 275. 332 (1959) 102 CLR 252 at 276. 333 (1959) 102 CLR 252 at 277. 334 (1959) 102 CLR 252 at 277. 335 cf NRDC Case (1959) 102 CLR 252 at 263-264; Funk Bros Seed Co v Kalo Inoculant Co 333 US 127 at 134-135 (1948). Hayne achieving good or better health is a benefit to the individual, but what that individual does with that product is a matter wholly and solely for that individual. It is not a benefit that the person who owns the right to use the process, or any person other than the individual who has been treated, can turn to commercial account. The product (the result, outcome or effect) produced by use of the process places the process beyond the (very wide) ambit of a "manner of manufacture" within the meaning of s 6 of the Statute of Monopolies. The product is not of a kind which makes the process a proper subject for the grant of a patent. A method of prevention or treatment of human disease is not a proper subject for the grant of a patent. Arguments not considered Apotex advanced two arguments which are not considered in these reasons. First, it drew attention to the ways in which several other jurisdictions have dealt with the patentability of a method of prevention or treatment of human disease. But neither the statutory regimes enacted in those jurisdictions, nor judicial decisions interpreting those provisions, provide any substantial assistance in resolution of this appeal. Second, Apotex submitted that the patent in suit claimed what is a second or subsequent medical use for a compound and that the claim made, being limited by the purpose for which the compound was used, was not patentable. For the reasons that have been given, this issue is not reached and need not be considered. Threatened infringement Having regard to the conclusion reached about patentability, the issue of threatened infringement which Apotex sought to raise is not reached, and, accordingly, the application by Apotex for special leave to appeal against so much of the orders of the Full Court as dealt with the question of infringement should be dismissed. It is as well, however, to say something shortly about the issue. It will be recalled that it was held, at first instance, that Apotex would have infringed the patent in suit by supplying Apo-Leflunomide for the treatment of PsA because use of the compound to treat PsA would inevitably treat or prevent psoriasis. It will also be recalled that Apotex supplied (and supplies) that Apo-Leflunomide with a product Apo-Leflunomide is "not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease". And it will be further recalled that, under the TGA, Apo-Leflunomide, as a therapeutic good registered on the ARTG and indicated for active RA and active PsA, but not psoriasis not information document stating Hayne associated with manifestations of arthritic disease, is a therapeutic good which is separate and distinct from any therapeutic good having different indications (including, in particular, one that is indicated for the treatment or prevention of psoriasis). Against this background of regulation, Apotex, as supplier of Apo-Leflunomide, would have reason to believe336 that those to whom it supplied the product would put it to the uses described in the indications with which the product was registered on the ARTG. That is, Apotex would have reason to believe that Apo-Leflunomide would be put to the use of preventing or treating either active RA or active PsA. to have any Apotex was not shown that Apo-Leflunomide would be put to any other use. More particularly, Apotex was not shown to have any reason to believe that Apo-Leflunomide would be put to the use of preventing or treating psoriasis not associated with manifestations of arthritic disease. The product was registered on the ARTG with an express exclusion of that indication for its use. to believe reason A person suffering active RA or active PsA may have psoriasis. Administration of an effective amount of Apo-Leflunomide to treat the active RA or active PsA would be likely to relieve the patient's psoriasis. But the Full Court was right to conclude337 that the claim in suit, on its proper construction, was confined to the deliberate administration of the compound to prevent or treat psoriasis. Apotex had reason to believe that Apo-Leflunomide would be put to the use of preventing or treating either active RA or active PsA, not psoriasis. Conclusion and orders The appeal to this Court should be allowed with costs. The application for special leave to appeal against so much of the orders of the Full Court of the Federal Court of Australia as dealt with the question of threatened infringement should be dismissed with costs. The orders of the Full Court of the Federal Court of Australia made on 18 July 2012 should be set aside. In their place, there should be orders that the appeal to that Court is allowed in part; orders 2, 3, 4, 6 and 8 of the orders of Jagot J made on 18 November 2011 and order 1 of the orders of Jagot J made on 24 February 2012 are set aside and in their place there be orders that Australian Patent Number 670491 is revoked. In accordance with the appellant's submission, the costs of the appeal to the Full Court and of the trial should be in the discretion of the Full Court. 336 s 117(2)(b). 337 (2012) 204 FCR 494 at 504-506 [37], [40]-[46] per Keane CJ, 524-526 [124]-[126], [128]-[129] per Bennett and Yates JJ. CRENNAN AND KIEFEL JJ. The appellant ("Apotex") appeals from a decision of the Full Court of the Federal Court of Australia338 in favour of the respondents. The appeal mainly concerns the validity of Australian Patent No 670,491 ("the Patent"), held by the second respondent, for an invention entitled "Pharmaceutical for the treatment of skin disorders". The single claim of the Patent, claim 1, is for "[a] method of preventing or treating a skin disorder, wherein the skin disorder is psoriasis, which comprises administering to a recipient an effective amount of [leflunomide]". The main issue for determination on this appeal is whether the subject matter of claim 1 is a "manner of manufacture" and hence a patentable invention within the meaning of s 18(1) of the Patents Act 1990 (Cth) ("the 1990 Act"). A discrete, narrower issue in respect of validity, also framed by reference to s 18(1), is whether claim 1, for a hitherto unknown therapeutic use of a pharmaceutical substance (having prior therapeutic uses), is a "manner of manufacture". By cross-claim, Apotex sought revocation of the Patent and, at the same time, denied infringement of claim 1 as alleged by the respondents. If the primary judge's order dismissing Apotex's cross-claim remains undisturbed, as it was left by the Full Court of the Federal Court, a third issue, the infringement issue, remains to be determined. That issue is whether the proposed supply by Apotex of leflunomide to treat psoriatic arthritis ("PsA") would infringe the Patent under s 117(1) of the 1990 Act, given that claim 1 is limited to the use of leflunomide for the prevention and treatment of psoriasis. The application for special leave to appeal in respect of infringement was referred to this Court to be argued as on an appeal. In these reasons it will be concluded that Apotex's application for revocation of the Patent must be refused on the basis that claim 1 discloses a patentable invention. Further, it will be explained that claim 1 is a claim limited by purpose. A method claim, for the administration of a pharmaceutical substance (with prior therapeutic uses) for a hitherto unknown therapeutic use, can be a patentable invention. Thus Apotex's narrower attack on the validity of the Patent fails. These reasons will also explain why Apotex's proposed supply of leflunomide to treat PsA is not an infringement of claim 1. 338 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494. Background facts On 14 December 1979, Hoechst AG, a subsidiary of the second respondent339, applied for and was granted a patent in Australia for the compound leflunomide, Australian Patent No 529,341 ("Patent 341"), which expired in 2004. For present purposes it can be noted that claim 1 of Patent 341 claimed the compound leflunomide and claim 4 claimed a "[m]ethod for the treatment of inflammations, rheumatic complaints or multiple sclerosis by administering to the patient an effective amount of [leflunomide]". On 29 March 1994, Hoechst AG applied for and was granted the Patent. The Patent has a priority date of 31 March 1993 and expires on 29 March 2014. Claim 1 has been set out above. Sanofi-Aventis Deutschland GmbH, the second respondent, is the registered owner of the Patent under the 1990 Act; Sanofi-Aventis Australia Pty Ltd ("Sanofi-Aventis"), the first respondent, supplies leflunomide in Australia under the trade names "Arava" and "Arabloc"; together with Aventisub II Incorporated, the third respondent, Sanofi-Aventis owns copyright in product information documentation relating to Arava (collectively, "Sanofi"). In 1999, leflunomide was included on the Australian Register of Therapeutic Goods ("the ARTG") for the treatment of rheumatoid arthritis ("RA") and PsA. In July 2008, Apotex obtained registration of its generic version of leflunomide, Apo-Leflunomide, on the ARTG. Apotex intends to supply and offer for supply Apo-Leflunomide in Australia for the treatment of RA and PsA. A number of related facts, about which there was no dispute in this Court, can be summarised. Psoriasis is a skin condition which occurs in about two per cent of the Australian population. Its occurrence is a diagnostic criterion of PsA. Almost every person with PsA has or will develop psoriasis. Patients who suffer from psoriasis will usually be referred to a dermatologist for treatment. Leflunomide is not used in Australia to treat psoriasis alone. Dermatologists do not prescribe leflunomide for that purpose; however, leflunomide is used by rheumatologists to treat RA and PsA. The evidence established that when this compound is prescribed to treat a patient with PsA, it is usually expected to also prevent or treat the patient's psoriasis, if that person has a concurrent case of psoriasis. 339 Hoechst AG merged with Rhône-Poulenc SA in 1999 to form Aventis Deutschland and became a part of the Sanofi-Aventis pharmaceuticals group in 2004. The litigation In 2008, Sanofi commenced proceedings in the Federal Court of Australia, claiming that Apotex's proposed supply in Australia of Apo-Leflunomide to treat PsA would infringe the Patent. Sanofi further claimed that Apotex's failure to warn potential customers that the use of Apo-Leflunomide would infringe the Patent constituted misleading and deceptive conduct under s 52 of the Trade Practices Act 1974 (Cth)340. Further, Sanofi alleged breach of copyright by Apotex under the Copyright Act 1968 (Cth). Sanofi's claims under the Trade Practices Act and the Copyright Act were dismissed by the Full Court and were not pursued on appeal to this Court. In addition to denying infringement of claim 1, relied on by Sanofi, Apotex, by cross-claim, sought revocation of the Patent on a number of grounds, including the ground that claim 1 did not disclose a patentable invention. Before the primary judge, Apotex reserved its right to challenge the correctness of two decisions of the Full Court of the Federal Court, namely Anaesthetic Supplies Pty Ltd v Rescare Ltd341 and Bristol-Myers Squibb Co v F H Faulding & Co Ltd342, as to whether a method of medical treatment of the human body is a patentable invention. On 18 November 2011, the primary judge (Jagot J) made orders in the Federal Court dismissing Apotex's cross-claim and restraining Apotex from infringing claim 1 of the Patent, in particular from supplying or offering to supply its leflunomide products "for the treatment of psoriatic arthritis". The Full Court dismissed Apotex's appeal its cross-claim and, notwithstanding construing claim 1 differently from the primary judge, the Full Court also dismissed Apotex's appeal concerning infringement. respect of 340 Section 52 of the Trade Practices Act 1974 (Cth) was replaced on 1 January 2011 by s 18 of the Australian Consumer Law, a schedule to the Competition and Consumer Act 2010 (Cth). 341 (1994) 50 FCR 1 ("Rescare"). 342 (2000) 97 FCR 524 ("Bristol-Myers Squibb"). The statutory framework Background Briefly, the first Australian patent legislation343, the Patents Act 1903 (Cth) ("the 1903 Act"), imported into Australia principles established and enacted in legislation then current in the United Kingdom344, where the law of patents had been wholly statutory since the Statute of Monopolies 1623345. Relevantly, "Invention" was defined in the 1903 Act to mean "any manner of new manufacture the subject of letters patent and grant of privilege within section six of the Statute of Monopolies"346. That definition was continued in the Patents Act 1952 (Cth)347 ("the 1952 Act") and in the 1990 Act348. Given that history, it is useful to observe, as Lord Diplock did, that the law of patents originated before the dawn of the modern sciences of physics and chemistry349. Until 1977, legislation in the United Kingdom continued to define "invention" by reference to s 6 of the Statute of Monopolies with the addition of "and any new method or process of testing applicable to the improvement or control of manufacture"350. However, on the introduction of the Patents Act 1977 (UK)351, requirements for patentability were codified for the purposes of harmonisation, following the Convention on the Grant of European Patents 343 Following colonial patent legislation. As to which see Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 496 [24]; [2000] HCA 14. 344 Patents, Designs, and Trade Marks Act 1883 (UK) as amended by the Patents, Designs, and Trade Marks (Amendment) Act 1885 (UK), the Patents Act 1886 (UK), the Patents, Designs, and Trade Marks Act 1888 (UK), the Patents Act 1901 (UK) and the Patents Act 1902 (UK). 345 21 Jac I c 3. 346 Patents Act 1903 (Cth), s 4. 347 Patents Act 1952 (Cth), s 6. 348 Patents Act 1990 (Cth), Sched 1. 349 Bristol-Myers Co v Beecham Group Ltd [1974] AC 646 at 678. 350 See, for example, Patents Act 1949 (UK), s 101(1). 351 Most provisions commenced operation on 1 June 1978. (1973) ("the EPC")352, about which more will be said later. It can be noted that s 130(7) of the Patents Act 1977 (UK) declares that various provisions "are so framed as to have, as nearly as practicable, the same effects in the United Kingdom as the corresponding provisions of the [EPC and] the Community Patent Convention". Returning to Australian patent legislation, revocation (originally by the prerogative writ of scire facias − in essence a writ to show cause) could be ordered upon a petition to the relevant court on the basis of any ground which would have been available at common law353. Lack of subject matter was a ground available pursuant to that writ354. Again, reflecting developments in the United Kingdom355, the 1952 Act introduced a consolidated list of grounds for the revocation of a patent, including the precursor to the ground under the 1990 Act relied upon by Apotex356. After the decision of Barwick CJ sitting in the original jurisdiction of the High Court in Joos v Commissioner of Patents357, which will be discussed later, the Australian Patent Office's Patent Examiner's Manual ("the Patent Manual") was changed to include an instruction to examiners of applications for patents that "no objection is to be taken to methods or processes for the treatment, medical or otherwise, of the human body or part of it, only on the basis that the human body is involved."358 The Industrial Property Advisory Committee ("the IPAC") reviewed the 1952 Act and reported to the Minister for Science and Technology on 29 August 352 Opened for signature on 5 October 1973; entered into force on 7 October 1977; revised 17 December 1991; further revised 29 November 2000. 353 Patents Act 1903 (Cth), s 86(3). See also Patents, Designs, and Trade Marks Act 1883 (UK), s 26. 354 Bannon, Australian Patent Law, (1984) at 3 [4]. 355 See, for example, Patents Act 1949 (UK), s 32. Further, s 3 of the Patents and Designs Act 1932 (UK) inserted a new s 25(2) into the Patents and Designs Act 356 Patents Act 1952 (Cth), s 100(1)(d). 357 (1972) 126 CLR 611; [1972] HCA 38 ("Joos"). 358 Australian Patent Office, Patent Examiner's Manual, July 1984 at [35.80]. 1984359. The IPAC noted that specific legislative exclusions from patentability "would be likely to prove a very slow, blunt and inefficient instrument for influencing the economic direction of particular industries or fields of technological development in Australia."360 The IPAC referred to the codified approach to patentability in the Patents Act 1977 (UK) and then said361: "We consider that the existing concept [manner of new manufacture] operates quite satisfactorily. It has the advantage of being underpinned by an extensive body of decided case law which facilitates its application in particular circumstances. At the same time it has, in the past, exhibited a capacity to respond to new developments. To replace it with a codification would be likely to produce far more problems, with attendant costs, than it would solve." As will be explained later in these reasons, that codified approach included a provision (now repealed) which expressly excluded from patentability methods of treatment of the human body. The IPAC's recommendation was accepted when the 1990 Act was enacted362. The Agreement on Trade-Related Aspects of Intellectual Property Rights (1995) ("the TRIPs Agreement")363, to which Australia is an original signatory, necessitated amendments to the 1990 Act so as to comply with Australian obligations under that Agreement364. Importantly, Art 27(1) provides that subject to Art 27(3), "patents shall be available for any inventions, whether products or processes, in all fields of technology, provided that they are new, involve an inventive step and are capable of industrial application." Article 27(3)(a) relevantly gives all contracting States the option to "exclude from patentability ... diagnostic, therapeutic and surgical methods for the treatment of humans". The 359 Industrial Property Advisory Committee, Patents, Innovation and Competition in Australia, 29 August 1984. 360 Industrial Property Advisory Committee, Patents, Innovation and Competition in Australia, 29 August 1984 at 40. 361 Industrial Property Advisory Committee, Patents, Innovation and Competition in Australia, 29 August 1984 at 41. 362 Australia, Senate, Patents Bill 1990, Explanatory Memorandum at 7 [31]. 363 Annex 1C to the Marrakesh Agreement establishing the World Trade Organization [1995] ATS 8. Entered into force in Australia and generally on 1 January 1995. 364 Patents (World Trade Organization Amendments) Act 1994 (Cth). abovementioned amendments to the 1990 Act did not enact Art 27(1) or Art 27(3)(a) of the TRIPs Agreement into Australian domestic law. However, the requirements for patentability under the 1990 Act are consistent with Australia's international obligations under Art 27(1). Relevant provisions of the 1990 Act In its cross-claim, Apotex relied on ss 138(3)(b) and 18(1)(a) of the 1990 Act. Section 138(3)(b) provides, as a ground of revocation, "that the invention is not a patentable invention". "Invention" is defined in Sched 1 to the 1990 Act to mean: "any manner of new manufacture the subject of letters patent and grant of privilege within section 6 of the Statute of Monopolies, and includes an alleged invention." Section 18(1)(a) of the 1990 Act provides that "an invention is a patentable invention ... if the invention, so far as claimed in any claim ... is a manner of manufacture within the meaning of section 6 of the Statute of Monopolies". Paragraphs (b), (c) and (d) of s 18(1) contain other requirements including that an invention be novel, involve an inventive step, and be useful. It can be noted that s 18(2), which first appeared in the 1990 Act, provides that "[h]uman beings, and the biological processes for their generation, are not patentable inventions." In SmithKline Beecham PLC's (Paroxetine Methanesulfonate) Patent365, Lord Walker of Gestingthorpe explained that the constitutional importance of the Statute of Monopolies, which generally declared void all monopolies, lay in its effect in curbing the prerogative of the Crown366. The proviso in s 6 excepts grants of letters patent for a term of 14 years or less, in respect of the "making of any manner of new manufactures within this Realm". The proviso is subject to a further proviso in s 6 excluding grants which are "contrary to the law ... mischievous to the State, by raising prices of commodities at home, or hurt of trade, or generally inconvenient". In Grain Pool of Western Australia v The Commonwealth367, this Court, citing National Research Development Corporation v Commissioner of 365 [2006] RPC 323. 366 [2006] RPC 323 at 341 [57]; see also Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 500 [38]. 367 (2000) 202 CLR 479 at 500 [38]. Patents368, explained the effect on patent law of the passage of the Statute of Monopolies: "Thereafter, the scope of permissible patentable subject matter involved an inquiry 'into the breadth of the concept which the law [had] developed by its consideration of the text and purpose of [that statute]'". So much was accepted by Apotex. Further, it was generally accepted that the basic purpose of patent legislation is to encourage invention (and any underlying research leading to an invention) by granting an inventor/patentee the protection of a limited monopoly, in exchange for benefit to the public of a full disclosure of the invention including the practical use to which it can be put369. Under the Royal Grant, once part of the words of grant of letters patent deriving from the Statute of Monopolies370, the patentee received "full power [and] sole privilege ... [to] make, use, exercise and vend the ... invention". It was for the patentee alone to "have and enjoy the sole use and exercise and the full benefit of the ... invention". Section 13(1) of the 1990 Act provides to the patentee "the exclusive rights, during the term of the patent, to exploit the invention and to authorise another person to exploit the invention." The definition of "exploit" in Sched 1 distinguishes between the circumstance where an invention is a product and where it is a method or process: "(a) where the invention is a product—make, hire, sell or otherwise dispose of the product, offer to make, sell, hire or otherwise dispose of it, use or import it, or keep it for the purpose of doing any of those things; or (b) where the invention is a method or process—use the method or process or do any act mentioned in paragraph (a) in respect of a product resulting from such use." 368 (1959) 102 CLR 252 at 269; [1959] HCA 67 ("the NRDC Case"). 369 See, for example, Blanco White, Patents for Inventions, 4th ed (1974) at 1 [1-101]. See also Diamond v Chakrabarty 447 US 303 at 315-316 (1980) and Actavis UK Ltd v Merck & Co Inc [2009] 1 WLR 1186 at 1196 [29]; [2009] 1 All ER 196 at 370 Blanco White, Patents for Inventions, 4th ed (1974) at 591-592 [14-38]. A distinction between product and method is also made in s 119A371, which creates an exception to infringement for acts undertaken solely for the purpose of applying for the inclusion of therapeutic goods on the ARTG. Section 119A(3) defines a "pharmaceutical patent" as including both a "pharmaceutical substance" and a "method, use or product relating to a pharmaceutical substance". A "pharmaceutical substance", defined in Sched 1 to the 1990 Act, means a substance for therapeutic use which involves "interaction ... with a human physiological system" or "action on an infectious agent, or on a toxin or other poison, in a human body". The expression "therapeutic use" as defined in Sched 1 includes "use for the purpose of … preventing, diagnosing, curing or alleviating a disease, ailment, defect or injury in persons". Section 70 confines extensions of term of standard patents relating to pharmaceutical substances to patents which claim (a) pharmaceutical substances per se; or (b) pharmaceutical substances that are "produced by a process that involves the use of recombinant DNA technology"372. Section 133, which provides for compulsory licensing, applies to both products and methods or processes which can be patented and envisages licensing a licensee "to work the patented invention."373 "Work" is defined in Sched 1 in relation to an invention which is "a method or process". Sanofi's claim regarding infringement rests on s 117 of the 1990 Act, which governs infringement by supply. Section 117 will be examined later in these reasons374. Primary judge Patentable invention? The primary judge rejected Apotex's narrow attack on the validity of the Patent. 371 Introduced into the 1990 Act by the Intellectual Property Laws Amendment Act 2006 (Cth), Sched 7, item 3. 372 Patents Act 1990 (Cth), s 70(2). 373 Patents Act 1990 (Cth), s 133(1). 374 See [293]−[305] below. Infringement The primary judge also rejected the construction of claim 1 of the Patent urged by Apotex. Regarding the infringement issue, Jagot J held that Apotex's intended supply of Apo-Leflunomide would infringe the Patent under s 117(1) of the 1990 Act. Her Honour's conclusions on infringement depended on the construction of claim 1, on which the parties disagreed. Her Honour explained375: "The essence of the dispute between the parties insofar as it related to the construction of the patent is ultimately whether the claim for a 'method of preventing or treating a skin disorder, wherein the skin disorder is psoriasis' by administration of a compound should be construed as involving the purpose, object or aim of the administration … or the effect in fact of the administration." Apotex preferred the former construction. Sanofi favoured the latter construction, which resulted in a finding of infringement dependent upon whether the administration of leflunomide would in fact have the effect of preventing or treating psoriasis. Accepting Sanofi's construction of claim 1, the primary judge found that the supply of Apo-Leflunomide for the treatment of PsA would infringe the Patent, as that use of the compound would inevitably lead to the treatment of psoriasis. Her Honour considered that "if leflunomide is administered to a patient with PsA, that administration would be expected also to prevent or treat the patient's psoriasis, to some extent at least."376 It followed that Apotex's intended supply of its generic leflunomide product to treat PsA would infringe the Patent under s 117 of the 1990 Act377. Her Honour also found that Apotex's approved product information document instructed rheumatologists to use Apo-Leflunomide for the treatment of psoriasis, which brought its intended supply of the pharmaceutical substance within s 117(2)(c)378. 375 Sanofi-Aventis Australia Pty Ltd v Apotex Pty Ltd (No 3) (2011) 196 FCR 1 at 41 376 Sanofi-Aventis Australia Pty Ltd v Apotex Pty Ltd (No 3) (2011) 196 FCR 1 at 33 377 Sanofi-Aventis Australia Pty Ltd v Apotex Pty Ltd (No 3) (2011) 196 FCR 1 at 77 378 Sanofi-Aventis Australia Pty Ltd v Apotex Pty Ltd (No 3) (2011) 196 FCR 1 at 77 Full Court of the Federal Court The Full Court (Keane CJ, Bennett and Yates JJ) unanimously dismissed the appeal379. Patentable invention? Keane CJ observed that, having regard to the passage of time since the decision of the Full Court of the Federal Court in Bristol-Myers Squibb380, the federal Parliament had been afforded ample opportunity to amend the 1990 Act to exclude methods of medical treatment of the human body as proper subject matter for the protection of patent legislation, and had not done so. Bennett and Yates JJ, in a joint judgment, refused to depart from the position expressed in obiter dicta in Rescare381 and Bristol-Myers Squibb382, that methods of medical treatment of the human body can be patented. That position was described by their Honours as "representing orthodoxy in Australian patent law."383 Bennett and Yates JJ also considered that it was "significant" that the federal Parliament had not been persuaded to amend the 1990 Act to give effect to policy considerations, to the extent that such considerations might tend against the patentability of methods of medical treatment of humans384. Infringement Turning to the infringement issue, Keane CJ considered that the primary judge had erred in construing claim 1 of the Patent as the administration of leflunomide in an effective amount, so that a patient's psoriasis was prevented or treated. His Honour considered that this construction failed to recognise that claim 1 was for a method of treatment of a specific human ailment, which "necessarily presuppose[d] a deliberate exercise of diagnosis and prescription by 379 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494. 380 (2000) 97 FCR 524. 381 (1994) 50 FCR 1. 382 (2000) 97 FCR 524. 383 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494 at 384 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494 at a medical practitioner … and the consequent prescription of the application of leflunomide."385 Keane CJ held that the claim in the Patent was limited to the use of leflunomide as an agent for the prevention or treatment of psoriasis. It followed that the Patent, on its true construction, would not be directly infringed by the application of leflunomide to prevent or treat PsA. Keane CJ went on to consider whether, despite his conclusions on the true construction of claim 1, Apotex would still be liable for infringement under s 117(1) of the 1990 Act. Based on the primary judge's findings of fact regarding Apotex's product information document, which engaged s 117(2)(b) and (c), his Honour found that the intended supply by Apotex of Apo-Leflunomide to treat PsA would infringe the Patent386. Bennett and Yates JJ were satisfied that it was open to the primary judge to find that Apotex's product information document contained an instruction to use Apo-Leflunomide to treat psoriasis, which engaged s 117(2)(c) of the 1990 Act. Their Honours also considered that there was no error in the primary judge's conclusions that Apotex had reason to believe that Apo-Leflunomide would be used to treat psoriasis, engaging s 117(2)(b)387. It followed that, as s 117(1) was engaged against Apotex, the appeal on the question of infringement could not succeed. Submissions Before this Court, Apotex submitted that methods of medical treatment of the human body were not a "manner of manufacture" and, therefore, were not patentable inventions in accordance with the principles developed for the application of s 6 of the Statute of Monopolies. Apotex eschewed the "generally inconvenient" rationale, considered by Barwick CJ in Joos388, as the preferable basis for excepting from patentability methods of medical treatment of the human body. This involved accepting that the requirements of novelty, inventive step 385 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494 at 386 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494 at 387 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494 at 388 (1972) 126 CLR 611 at 623. and utility389, and correlative grounds for revocation, subsume and embody what was once covered by the "generally inconvenient" ground for a refusal of grant. Instead, relying on obiter dicta of this Court in the celebrated NRDC Case390, Apotex argued that methods of medical treatment of humans are "essentially non-economic". Apotex contended that when the 1990 Act came into force, the established law in Australia and the United Kingdom was that a method (or process) of medical treatment of the human body is not a manner of manufacture and hence not a patentable invention. Apotex went on to submit that the abovementioned obiter dicta in the NRDC Case was insufficiently apprehended in Joos391, Rescare392 and Bristol-Myers Squibb393. In the latter two cases, albeit also in obiter dicta, it was said that a method of medical treatment of the human body can be a "manner of manufacture" and hence a patentable invention. Apotex submitted that Rescare, followed in Bristol-Myers Squibb, was in that respect wrongly decided. Further, Apotex contended that the majority in Rescare failed to recognise that methods of medical treatment of the human body should not be regarded as "industrialised". That submission seemed to evoke public policy considerations in addition to the idea that methods of medical treatment of the human body are not capable of being industrially applied. An elusive distinction which Apotex ventured between a medicine (long considered a manner of manufacture, therefore an invention394) and a method of treatment involving the administration of a pharmaceutical substance was that the latter improves the condition of a human being, which is not an article of commerce. For this reason, Apotex submitted that a method of medical treatment of the human body cannot be a the patentable administration of leflunomide (a known compound with prior therapeutic uses) the alternative, Apotex contended invention. that 389 Patents Act 1990 (Cth), s 18(1)(b) and (c). 390 (1959) 102 CLR 252 at 275. See also Maeder v Busch (1938) 59 CLR 684; [1938] HCA 8. 391 (1972) 126 CLR 611. 392 (1994) 50 FCR 1. 393 (2000) 97 FCR 524. 394 R v Wheeler (1819) 2 B & Ald 345 at 349 [106 ER 392 at 394]. It should be noted that in addition to referring to "medicine", Abbott CJ surmised that the word "manufacture" "may perhaps extend also to a new process to be carried on by known implements, or elements, acting upon known substances". for a hitherto unknown purpose is not a manner of manufacture within s 18(1)(a) of the 1990 Act. On the infringement issue, Apotex submitted that the question before this Court was whether Apotex had "reason to believe"395 that medical practitioners would use Apo-Leflunomide for the claimed purpose, being the prevention and treatment of psoriasis. It was contended that special leave should be granted to determine what constitutes the necessary "reason to believe" under s 117(2)(b) of the 1990 Act. Sanofi submitted that the language and context of the 1990 Act made clear that the expression "manner of manufacture" in s 18(1)(a) included methods of medical treatment of the human body. Sanofi also relied on the circumstance that no decision of this Court has held that methods of treatment of the human body are not patentable. Further, Sanofi refuted the proposition that methods of medical treatment are excluded from patentability on the ground that they are "non-economic". Sanofi contended that no point of principle was raised by the question of infringement under s 117(1) of the 1990 Act and that the Full Court's decision on this point was correct. Patentable invention? The question posed by Apotex's claim for revocation of the Patent is whether, assuming all other requirements for patentability are met, a method of medical treatment of the human body can be a patentable invention. That question has not been decided by this Court. There being no express exclusion of such methods in the 1990 Act, the question of the construction of s 18(1)(a) is to be decided by reference to the principles developed for the application of s 6 of the Statute of Monopolies396. Whether a method of medical treatment of the human body is a proper subject matter for a grant of monopoly under a patent system has been considered by tribunals and courts in a number of major jurisdictions, some with patent legislation which similarly defines invention by reference to the expression "manner of manufacture" in s 6 of the Statute of Monopolies (as in the United Kingdom, until 1977, and New Zealand), and some with patent legislation which defines invention otherwise (as in the United States of America and Canada). To speak of "methods of medical treatment of the human body" is to employ an expression of sufficient generality to encompass both drug therapies 395 See Patents Act 1990 (Cth), s 117(2)(b). 396 NRDC Case (1959) 102 CLR 252 at 269. capable of industrial application and the know-how involved in a medical practitioner's diagnosis and methods of treatment (including surgery) of patients. Distinguishing the two types of activity has proved problematic in many jurisdictions397. Irrespective of the differences in national patent legislation, a clear, perhaps insoluble, conflict has emerged between two relevant competing considerations. The first consideration is the undesirability of having a patent system intruding on the freedom of a medical practitioner to treat a patient, without being restrained by the need to consider whether a patent licence is necessary. The conflicting consideration is the desirability of having a logical patent system which encourages research and invention in relation to drug therapies, not only by granting monopolies for novel medicines (and for that matter novel medical implements), but also by not excluding from patentability hitherto unknown therapeutic uses of known compounds, where novelty requirements can most directly be satisfied by a claim to a method or process, which is in effect a claim limited to the hitherto unknown therapeutic use. Professor Cornish and his co-authors have remarked398: "In the second half of the twentieth century, patent law in every industrial state had to develop in ways which mediated this conflict." Relevant authorities In Australian law, the starting point is the recognition in the NRDC Case that any attempt to define the word "manufacture" or the expression "manner of manufacture", as they occur in s 6 of the Statute of Monopolies, is bound to fail399. Apotex agreed that "manner of manufacture" refers to a broad concept indicating "the scope of the permissible subject matter of letters patent"400, which 397 Moufang, "Methods of Medical Treatment Under Patent Law", (1993) 24 International Review of Industrial Property and Copyright Law 18; Dworkin, "Patents Relating to Methods of Medical Treatment", in Hansen (ed), International Intellectual Property Law & Policy, (2001), vol 6, Ch 12; Pila, "Methods of Medical Treatment within Australian and United Kingdom Patents Law", (2001) 24 University of New South Wales Law Journal 420; Visser, "The Exclusion of Medical Methods", in Kur, Luginbühl and Waage (eds), Patent Law on the Move, 398 Cornish, Llewelyn and Aplin, Intellectual Property: Patents, Copyright, Trade Marks and Allied Rights, 7th ed (2010) at 238 [5-65]. 399 NRDC Case (1959) 102 CLR 252 at 271. 400 NRDC Case (1959) 102 CLR 252 at 269. has continually widened since 1795, when Boulton v Bull401 was decided. The continual widening of the concept reflects the growth of patent law as patent law, in turn, reflects scientific and technical developments 402. In Boulton v Bull, Eyre LCJ included in the concept of manufacture "new processes in any art producing effects useful to the public."403 The concept was widened when it was finally settled in 1842 in Crane v Price404 that a process may be an art for patent law purposes405. The word "method" was also accepted as a synonym for "process"406. What remained unsettled before the NRDC Case was whether it was sufficient for a process to produce a useful result or whether it was necessary for a physical thing either to be brought into existence by the process, or to be so affected "as the better to serve man's purposes."407 In contending that the 1990 Act must be construed as excepting or excluding methods of medical treatment of the human body from patentability, Apotex relied on obiter dicta in Maeder v Busch and the NRDC Case, and on various decisions in the United Kingdom pre-dating the Patents Act 1977 (UK). The first three decisions discussed below form the backdrop to the reasoning and conclusions of this Court in the NRDC Case. 1914 – Re C & W's Application In Re C & W's Application408, Sir Stanley Buckmaster (as he then was), sitting as second law officer on an appeal from the refusal of a grant, decided that a process for extracting metals from living bodies, particularly from persons suffering from lead poisoning, was not a manner of manufacture and was therefore not an invention suitable for patent protection under the Patents and two Designs Act 1907 (UK). That conclusion was underpinned by 401 (1795) 2 H Bl 463 at 492 [126 ER 651 at 666]. 402 Maeder v Busch (1938) 59 CLR 684 at 706; NRDC Case (1959) 102 CLR 252 at 269-270; Rescare (1994) 50 FCR 1 at 8. 403 (1795) 2 H Bl 463 at 492 [126 ER 651 at 666]. 404 (1842) 4 Man & G 580 [134 ER 239]. 405 Halsbury, The Laws of England, (1912), vol 22 at 137. 406 R v Wheeler (1819) 2 B & Ald 345 at 350 [106 ER 392 at 395]. 407 NRDC Case (1959) 102 CLR 252 at 270. 408 (1914) 31 RPC 235. considerations: first, the process under consideration was not used in the making of an object of commercial value, nor was it adapted to that end; and second, the process was not employed "in any form of manufacture or of trade"409, even though the process might be useful in improving the condition of humans. 1938 – Maeder v Busch This Court's decision in Maeder v Busch410 concerned an application for grant in respect of a process for permanently waving human hair, which was found to be invalid for reasons of prior use. However, Sir Stanley Buckmaster's rationale was taken up, in obiter dicta, by Dixon J. His Honour said of a process or method of treatment of the human body, including a process or method for the relief of suffering by surgical or manipulative means411: "[T]he object [of the process or method] is not to produce or aid the production of any article of commerce. No substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence by means of or with the aid of the process." 1942 – GEC's Application It seems that after 1914 in the United Kingdom, it was accepted as axiomatic that there could be no patents for methods of medical treatment of the human body412. A broad rule, relying on Sir Stanley Buckmaster's approach, was formulated by Morton J in GEC's Application413, seeking to draw a helpful (although not exhaustive) line between a method or process which is a manner of manufacture and one which is not. A method or process was said by Morton J to be a manner of manufacture if it (a) resulted in the production of some vendible product; or (b) improved or restored a vendible product; or (c) preserved a vendible product from deterioration414. Whilst Morton J's rules were influential in both the United Kingdom and Australia, it was suggested in a series of 409 (1914) 31 RPC 235 at 236. 410 (1938) 59 CLR 684. 411 (1938) 59 CLR 684 at 706. 412 In re Schering AG's Application [1971] 1 WLR 1715 at 1719; [1971] 3 All ER 177 413 (1942) 60 RPC 1. 414 GEC's Application (1942) 60 RPC 1 at 4. subsequent cases in the United Kingdom that when the expression "vendible" is used in the context of a process, it is a reference to a capacity for commercial or industrial application415. 1959 − The NDRC Case The NRDC Case416 concerned an appeal from a decision of the Deputy Commissioner of Patents, directing that certain claims be deleted from the specification of an application on the ground that the method claimed was not a manner of manufacture because it did not result in any vendible product. In coming to his decision, the Deputy Commissioner had relied on Re C & W's Application and GEC's Application. In determining that a novel use of known substances (for the eradication of weeds from crops) was a patentable invention, this Court (Dixon CJ, Kitto and Windeyer JJ) decided that it was not essential that a process produce or improve a vendible article. Their Honours explained417, by reference to the doctrine of analogous uses set out in BA's Application418: "If ... the new use that is proposed consists in taking advantage of a hitherto unknown or unsuspected property of the [known] material ... there may be invention in the suggestion that the substance may be used to serve the new purpose; and then, provided that a practical method of so using it is disclosed and that the process comes within the concept of patent law ultimately traceable to the use in the Statute of Monopolies of the words 'manner of manufacture,' all the elements of a patentable invention are present ... It is not necessary that in addition the proposed method should itself be novel or involve any inventive step". Their Honours went on to decide that a hitherto unknown use of a (known) material can qualify as a manner of manufacture if the process "offers some advantage which is material", in the sense that the process belongs to a 415 See Re Cementation Co Ltd's Application (1945) 62 RPC 151 at 154; Re Rantzen's Application (1946) 64 RPC 63; Elton and Leda Chemicals Ltd's Application [1957] RPC 267. 416 (1959) 102 CLR 252. 417 (1959) 102 CLR 252 at 262. 418 (1915) 32 RPC 348 at 349; see also Commissioner of Patents v Microcell Ltd (1959) 102 CLR 232 at 247-249; [1959] HCA 71. useful art (as distinct from a fine art), and has "value to the country … in the field of economic endeavour."419 Parenthetically, citing Re C & W's Application and Maeder v Busch, their Honours noted "[t]he need ... to put aside, as they apparently must be put aside, processes for treating diseases of the human body"420. The rationale assumed for the exclusion from patent protection of "methods of surgery and other processes for treating the human body", now relied on by Apotex, was that "the whole subject is conceived as essentially non-economic"421. 1971 – In re Schering AG's Application In In re Schering AG's Application422, the Patents Appeal Tribunal (Graham and Whitford JJ) allowed an application for a contraceptive to proceed to grant on the ground that a contraceptive was strictly distinguishable from a method of medical treatment of the human body. The Tribunal accepted that although the Patents Act 1949 (UK) did not, in terms, exclude from patentability methods of medical treatment of humans, so much inferentially appears to have been in the contemplation of Parliament at least since enacting s 41423 of the Patents Act 1949424. Reference was also made to the 50 year old practice of the Patent Office of refusing such applications (first referred to in Re C & W's Application). Since novel therapeutic products and curative devices could secure patent protection, the Tribunal noted that, despite the strong support to be found in s 41 for excluding processes for medical treatment from patentability, the 419 (1959) 102 CLR 252 at 275. 420 (1959) 102 CLR 252 at 270. 421 (1959) 102 CLR 252 at 275. 422 [1971] 1 WLR 1715; [1971] 3 All ER 177. 423 Section 41, providing for compulsory licensing, covered "medicine" and "a surgical or curative device" but did not mention "processes for medical treatment". 424 First introduced into the Patents and Designs Act 1907 (UK) as s 38A(2) by the Patents and Designs Act 1919 (UK), s 11. exclusion appeared to be based on ethics rather than logic425. That reasoning was affirmed subsequently in Eli Lilly & Co's Application426. In Joos427, decided under the 1952 Act, Barwick CJ sat on an appeal from a refusal of grant in respect of a method or process for the treatment of hair and nails. His Honour referred to In re Schering AG's Application with approval and went on to distinguish medical prophylactic or therapeutic methods or processes from cosmetic methods or processes, both of which applied to the human body. Although his Honour said it was not necessary for him to identify the basis for excepting the former class of method or process claims, if an exclusion from patentability were to be maintained it should be on "public policy [grounds] as being, in the language of the Statute of Monopolies, 'generally inconvenient'"428. In expressing that opinion, the Chief Justice rejected "[p]art at least of the premises on which the observations [by Dixon J in Maeder v Busch] were made ... that surgery or other processes for treating the human body were of their nature essentially non-economic."429 The possibility that such treatments might have economic utility, or commercial or industrial application, seemed obvious to his Honour, given the economic impact of worker's compensation, invalid pensions and repatriation costs430. As explained above, Patent Office practice was altered after Joos so as to permit applications for patents which claimed methods or processes of medical treatment of the human body. 425 [1971] 1 WLR 1715 at 1722; [1971] 3 All ER 177 at 183. See also Rescare Ltd v Anaesthetic Supplies Pty Ltd (1992) 111 ALR 205 at 237. 426 [1975] RPC 438 at 445. 427 (1972) 126 CLR 611. 428 (1972) 126 CLR 611 at 623. 429 (1972) 126 CLR 611 at 618. 430 (1972) 126 CLR 611 at 618. 1980 – Wellcome Foundation v Commissioner of Patents the United Kingdom431, Following developments in Wellcome Foundation Ltd v Commissioner of Patents432 this Court determined that novel packaging, containing directions for using a known substance or compound for a hitherto unknown use or purpose, may be a "manner of manufacture". In so doing, the Court elucidated the expansion of the concept of "manner of manufacture" decided in the NRDC Case, distilled thus433: "This principle [in the NRDC Case] extends to a process which does not produce a new substance but results in 'a new and useful effect'. If the new result is 'an artificially created state of affairs' providing economic utility, it may be considered a 'manner of new manufacture' within s 6 of the Statute of Monopolies". (emphasis added) Such was the relevant case law concerning methods of medical treatment of the human body before the passage of the 1990 Act. Rescare and Bristol-Myers Squibb At first instance in Rescare Ltd v Anaesthetic Supplies Pty Ltd434, the patent in suit contained method claims as well as product claims. The primary judge (Gummow J) rejected a claim for revocation of the method claims for treatment of the human body on the basis that they did not claim an "invention" (within the definition of "invention" in the 1952 Act). His Honour accepted the suggestion made by Barwick CJ in Joos, that the only basis upon which the exclusion from patentability of methods of medical treatment of humans could be continued (if it should be) was "general inconvenience". This was essentially because there was no logical distinction to be made between a patent for a method or process for treatment of the human body and a product for the same435. 431 Organon Laboratories Ltd's Application [1970] RPC 574; see also L'Oreal's Application [1970] RPC 565 and Ciba-Geigy AG (Durr's) Applications [1977] RPC 432 (1980) 145 CLR 520; [1980] HCA 21. 433 (1980) 145 CLR 520 at 528. 434 (1992) 111 ALR 205. 435 (1992) 111 ALR 205 at 238. To ensure that the method claims were fairly based, his Honour was prepared to allow amendments to those claims, to claim a treatment of obstructive sleep apnoea in humans. Like Barwick CJ in Joos, his Honour did not accept the generality of the obiter dicta in Maeder v Busch, repeated in the NRDC Case, that methods of medical treatment of the human body are "essentially non-economic". The method claims with which his Honour was dealing did not involve surgery and there does not appear to have been any suggestion that the claims, as amended, would lack commercial application. On appeal, a majority of the Full Court of the Federal Court (Lockhart and Wilcox JJ, Sheppard J dissenting) upheld the primary judge's reasoning and decision in respect of methods of medical treatment of the human body, although their Honours found that the method claims in issue were not fairly based on the provisional specification. In the majority, Lockhart J found that once the notion of the necessity for a vendible product (as in Re C & W's Application) is eliminated (as it was in the NRDC Case), there is no distinction in principle between a product for treating humans and a method for treating humans436. His Honour considered that the distinctions between a contraceptive and other methods of treatment of the human body (In re Schering AG's Application), and between processes which produce a cosmetic result and processes which produce a curative result (Joos), were distinctions without a difference which could not sustain a principle distinguishing what is an invention and patentable from what is not. His Honour said437: "I see no reason in principle why a method of treatment of the human body is any less a manner of manufacture than a method for ridding crops of weeds as in NRDC. Australian courts must now take a realistic view of the matter in the light of current scientific development and legal process; the law must move with changing needs and times ... If a process which does not produce a new substance but nevertheless results in 'a new and useful effect' so that the new result is 'an artificially created state of affairs' providing economic utility, it may be considered a 'manner of new manufacture' within s 6 of the Statute of Monopolies". (emphasis added) That reasoning is correct. In agreeing with Lockhart J, Wilcox J noted Parliament's deliberate decision not to exclude methods of treatment of humans 436 (1994) 50 FCR 1 at 18. 437 (1994) 50 FCR 1 at 19. from patentability in the 1990 Act438. His Honour considered that courts should hesitate to introduce the exclusion, especially given the developments in the application of the concept of "manner of new manufacture", which widened rather than narrowed the concept439. Before turning to consider briefly the position elsewhere, it can be noted that in Bristol-Myers Squibb, decided under the 1990 Act, a Full Court of the Federal Court, following Rescare, overturned a finding that the patents in suit claiming a method of administering an anti-cancer drug were invalid on the grounds of "general inconvenience". Black CJ and Lehane J acknowledged "the difficulty ... of drawing any logical distinction between a method of treatment and a patentable pharmaceutical product that produces the same beneficial results."440 Agreeing with the joint reasons, Finkelstein J referred to the TRIPs Agreement and took the view that if public policy required medical treatment and surgical processes to be excluded from patent protection, it was for Parliament to amend the 1990 Act441. The position elsewhere Decisions from overseas, including those of the European Patent Office, are of course not binding on this Court. The Court has noted the existence of significant divergences between the case law concerning the 1952 Act and the 1990 Act, and patent legislation in the United Kingdom in 1949 and 1977, in relation to the patentability requirements of obviousness442 and inventive step443. However, the theory and purpose of patent legislation everywhere have much in common, and the 1990 Act includes provisions designed to "harmonise [Australian patent law] with the laws of Australia's major trading partners"444 and 438 (1994) 50 FCR 1 at 42-43. 439 (1994) 50 FCR 1 at 43. 440 (2000) 97 FCR 524 at 530 [17]. 441 (2000) 97 FCR 524 at 567 [132], 569 [142]. 442 Aktiebolaget Hässle v Alphapharm Pty Ltd (2002) 212 CLR 411 at 427-430 [33]-[42]; [2002] HCA 59. 443 Lockwood Security Products Pty Ltd v Doric Products Pty Ltd [No 2] (2007) 235 CLR 173 at 193 [46]; [2007] HCA 21. 444 "Government Response to the Report of the Industrial Property Advisory Committee, 'Patents, Innovation and Competition in Australia'", Official Journal of Patents, Trade Marks and Designs, 18 December 1986, vol 56, No 47 at 1477. to ensure compliance with Australia's international obligations under the TRIPs Agreement445. The question of whether methods of medical treatment of humans can (or should) be patented does not turn on any express or implied exclusion in the 1990 Act, or on any normative distinctions to be drawn from its provisions. Further, an understanding of the position in Europe and the United Kingdom informs Apotex's second attack on the validity of the Patent. The TRIPs Agreement, to which there are 159 contracting States including Australia, has influenced the developments described below in Europe, the United Kingdom and New Zealand. Europe As a prelude to discussing an express exception to patentability of methods of medical treatment of the human body in the EPC446, the general position in relation to hitherto unknown therapeutic uses is set out in Terrell's textbook447: "Historically, the first inventor of a new product suitable for use in medical treatment was entitled to a claim to the product per se. This remains the case. Difficulties arise where the product is already known and the invention resides in the discovery of a novel medical use (first medical use), or where, although known for medical use, the invention resides in the discovery of a novel second medical use." In conformity with Art 27(1) of the TRIPs Agreement, Art 52(1) of the EPC provides that "patents shall be granted for any inventions, in all fields of technology, provided that they are new, involve an inventive step and are susceptible of industrial application." Article 53, headed "Exceptions to patentability", provides for heterogeneous exceptions to that general approach to patentability448. Relevantly, an exception for methods of treatment of the human body is set out in Art 53(c): 445 Australia, House of Representatives, Intellectual Property Laws Amendment Bill 2006, Explanatory Memorandum at 41 [141]. 446 Followed in the Patents Act 1977 (UK), s 4A(1). 447 Terrell on the Law of Patents, 17th ed (2011) at 41 [2-28]. 448 Aerotel Ltd v Telco Holdings Ltd; Macrossan's Patent Application [2007] RPC 117 at 155 [118], quoting Pumfrey J in Shopalotto.com Ltd's Application [2006] RPC "European patents shall not be granted in respect of ... (c) methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practised on the human or animal body; this provision shall not apply to products, in particular substances or compositions, for use in any of these methods." Article 54(4) ameliorates the effect of that exception: a substance or compound is deemed novel in respect of a new therapeutic use449. That such use of a (known) substance or compound is not denied novelty is squarely within the general principle established in the NRDC Case, that the discovery of a new use of a known substance which has both an artificial effect and economic utility can be a "manner of manufacture", and therefore a patentable invention. Claims for a second (or subsequent) hitherto unknown therapeutic use of a known compound were not expressly permitted under the original (1973) EPC but came to be allowed in a decision of the Enlarged Board of Appeal of the European Patent Office ("EPO") in Eisai/Second medical indication450 approving "Swiss type" claims. A "Swiss type" claim is generally in the form of a claim to "the use of [known] compound X in the manufacture of a medicament for a specified (and new) therapeutic use"451, the Swiss Federal Intellectual Property Office having first instituted a practice of allowing such claims in 1984452. The essential purpose of a "Swiss type" claim was described by Jacob J in Bristol-Myers Squibb Co v Baker Norton Pharmaceuticals Inc453: "By taking the [Swiss] form ... the claim is trying to steer clear of two obstacles to patentability, namely the requirement of novelty and the ban on methods of treatment of the human body by therapy." 449 Article 54(4) does not exclude from patentability "any substance or composition, comprised in the state of the art, for use in [an excepted method], provided that its use for any such method is not comprised in the state of the art." 450 [1979-1985] EPOR B241 ("Eisai"). 451 Bristol-Myers Squibb Co v Baker Norton Pharmaceuticals Inc [1999] RPC 253 at 452 See Legal Advice from the Swiss Federal Intellectual Property Office [1984] OJ EPO 581. 453 [1999] RPC 253 at 271 [44]. Of the sophistry involved, Jacob J said454: "[I]f one accepts that a patent monopoly is a fair price to pay for the extra research incentive, then there is no reason to suppose that that would not apply also to methods of treatment. It is noteworthy that in the US any such exception has gone, and yet no-one, so far as I know, suggests that its removal has caused any trouble." Inevitably, the monopoly granted in respect of such claims is limited given that the substance has prior therapeutic uses. Following Eisai, in Mobil/Friction reducing additive455 an Enlarged Board of Appeal upheld a claim to the use of a specified lubricant for the reduction of friction in engines, even though it had previously been used as a rust inhibitor. In Merrell Dow Pharmaceuticals Inc v HN Norton & Co Ltd456, Lord Hoffmann noted the difficulties which this type of claim might cause in respect of infringement but refrained from holding that a claim in that form was invalid. Article 54(5) of the (2000) EPC457 now deems novel second (and subsequent) therapeutic uses458 in respect of (known) substances or compounds. In describing the relevant amendments to the EPC in 2000 (including the redrafted Art 54(5)), an Enlarged Board of Appeal in Abbott Respiratory/Dosage regime459 stated that excluding methods of treatment of the human body from patentability (as in Art 52(4) of the original (1973) EPC) on the basis of the "fiction" that such methods were incapable of industrial application became untenable, when the real reason for the exception was "socio-ethical and public health considerations."460 The Board said that the limited purpose of the 454 [1999] RPC 253 at 274 [51]. 455 [1990] EPOR 73. 456 [1996] RPC 76 ("the Merrell Dow Case"). 457 As revised in 2000. It is important to note that Art 52(4) of the original (1973) EPC is now Art 53(c) and Art 54(5) of the original (1973) EPC is now Art 54(4). 458 Article 54(5) excepts from the exclusion from patentability "any substance or composition referred to in paragraph 4 for any specific use in a method referred to in Article 53(c), provided that such use is not comprised in the state of the art." 459 [2010] EPOR 262 ("Abbott's Case"). 460 Abbott's Case [2010] EPOR 262 at 273. exception from patentability in Art 53(c) (and its predecessor, Art 52(4)) is to free from restraints a medical practitioner's diagnosis and treatment of patients, which the Board described as "non-commercial and non-industrial medical … activities"461. The Board also considered relevant extrinsic material and stated that amendments permitting the patenting of second (and subsequent) uses of known substances and compounds rendered the EPC "TRIPs-compliant" in respect of Art 27(1). Such claims must, of course, still satisfy the requirements of novelty and inventive step, and be capable of industrial application. For the sake of completeness, it can also be noted that key expressions in the exception in Art 53(c), "surgery", "therapy" and "diagnostic methods" (followed in the cognate s 4A(1) of the Patents Act 1977 (UK)), have all been subject to decisions or considerations turning on fine, and some have said troubling, distinctions462. The current position in Europe is set out in the EPO Guidelines for Examination 2012463. As a result of the amendments to the EPC in 2000, claims for second (or subsequent) hitherto unknown uses of known substances or compounds may be drafted more simply and directly than "Swiss type" claims (now not permitted) as "substance X for use in the treatment of disease Y". United Kingdom Since the passage of the Patents Act 1977 (UK), law and practice in the United Kingdom have followed that in Europe. 461 Abbott's Case [2010] EPOR 262 at 273. 462 Terrell, Terrell on the Law of Patents, 17th ed (2011) at 39 [2-24]. See also United Kingdom Intellectual Property Office, Examination Guidelines for Patent Applications relating to Medical Inventions in the Intellectual Property Office, 463 European Patent Office, Guidelines for Examination in the European Patent Office, (2012), Pt G, Ch VI-3 at [7.1]. Relevantly, the Guidelines provide: "A claim in the form 'Use of substance or composition X for the treatment of disease Y ...' will be regarded as relating to a method for treatment explicitly excluded from patentability under Art 53(c) and therefore will not be accepted. A claim in the form 'Substance X for use as a medicament' is acceptable, even if X is a known substance, but its use in medicine is not known. Likewise, it is acceptable to have a claim in the form 'Substance X for use in the treatment of disease Y', provided that such a claim involves an inventive step over any prior art disclosing the use of X as a medicament." The former definition of an invention as a "manner of new manufacture" in the Patents and Designs Act 1907 (UK)464 has been replaced by statutory requirements for patentability set out in ss 1(1) to 1(4) of the Patents Act 1977 (UK)465. A patent may only be granted if four conditions are satisfied. Two of the four conditions relevant for present purposes are that an invention must be capable of industrial application466 and must not be otherwise excluded under the Act, including under s 4A467. It can be noted that before amendments were made to the EPC in 2000, as described above, s 4(2) of the Patents Act 1977 (UK) (now repealed468) employed the "fiction" criticised in Abbott's Case by providing that a method of treatment of the human body by surgery or therapy or a method of diagnosis "shall not be taken to be capable of industrial application."469 Section 4(1) of the Patents Act 1977 (UK) provides that an invention shall be taken to be capable of industrial application if it can be made or used in any kind of industry, including agriculture. Section 4A(1) of the Patents Act 1977 (UK)470 excludes from patentability: a method of treatment of the human or animal body by surgery or therapy, or a method of diagnosis practised on the human or animal body." Relevantly, s 4A(2)471 excludes from the exception "a substance or composition for use in any [excluded] method"; s 4A(3)472 deems novel a known 464 Patents and Designs Act 1907 (UK), s 93, which definition had been maintained continuously since the Patents, Designs, and Trade Marks Act 1883 (UK), s 46. 465 Corresponding to Arts 52 to 57 of the (2000) EPC. 466 Patents Act 1977 (UK), s 1(1)(c), following Art 52(1) of the (2000) EPC. 467 Patents Act 1977 (UK), s 1(1)(d). 468 By the Patents Act 2004 (UK), Sched 2, par 4. 469 Following Art 52(4) of the (1973) EPC. 470 Following Art 53(c) of the (2000) EPC. 471 Following the second phrase of Art 53(c) of the (2000) EPC. 472 Following Art 54(4) of the (2000) EPC. substance or composition in respect of a first hitherto unknown therapeutic use; and s 4A(4) essentially deems novel a known substance or composition in respect of a second (or subsequent) hitherto unknown therapeutic use473, in each case by the the known substance or legislative composition. technique of "deeming" novel The decision in Eisai474 was followed by the English Court of Appeal in Actavis UK Ltd v Merck & Co Inc475. The Court of Appeal confirmed that "[n]ovelty of purpose for use can confer novelty even if the substance is old and unpatentable as such."476 The Court of Appeal also said that the difficulties to by concerning Lord Hoffmann the pharmaceutical industry by the strict regulation of the manufacture and sale of pharmaceutical products. referred the Merrell Dow Case477, were ameliorated infringement with such "purpose" claims, New Zealand Section 2(1) of the Patents Act 1953 (NZ) defines "invention" in terms of s 6 of the Statute of Monopolies. Methods of treatment of the human body are not expressly excluded from patentability. Such methods were, however, held by the Court of Appeal of New Zealand not to be patentable in Wellcome Foundation Ltd v Commissioner of Patents478 and Pfizer Inc v Commissioner of Patents479. The exclusion from patentability reflected a longstanding practice in the New Zealand Patent Office of refusing grants for such methods. Notwithstanding the exclusion, in Pharmaceutical Management Agency Ltd v Commissioner of Patents480 the Court of Appeal of New Zealand approved 473 Formerly advanced in "Swiss type" claims. 474 [1979-1985] EPOR B241. 475 [2009] 1 WLR 1186 at 1193-1196 [18]-[31]; [2009] 1 All ER 196 at 204-206; cf Bristol-Myers Squibb Co v Baker Norton Pharmaceuticals Inc [2001] RPC 1. 476 [2009] 1 WLR 1186 at 1193 [18]; [2009] 1 All ER 196 at 204. 477 [1996] RPC 76. 478 [1983] NZLR 385. 479 [2005] 1 NZLR 362. 480 [2000] 2 NZLR 529. a Practice Note of the Commissioner of Patents to the effect that "Swiss type" claims would henceforward be permitted. In doing so, the Court of Appeal followed the reasoning in Eisai481. In reviewing developments in Europe, and in the United Kingdom both before and after the Patents Act 1977 (UK), the Court of Appeal said482: "[I]t seems that the exclusion from patentability of methods of medical treatment of humans is now supported only on ethical grounds. Yet patents are granted for pharmaceutical and surgical products. As Davison CJ concluded in the Wellcome case[483], there is little logic in maintaining the exclusion ... [I]t no longer can be said that a method of treating humans cannot be an invention. To the extent that [appellate] judgments in Wellcome[484] express that view we depart from them. The exclusion from patentability of methods of medical treatment rests on policy (moral) grounds. The purpose of the exclusion is to ensure that medical practitioners are not subject to restraint when treating patients. It does not extend to prevent patents for pharmaceutical inventions and surgical equipment for use in medical treatment." The Court of Appeal concluded that once it is accepted that a hitherto unknown use of a (known) compound could be an invention (as has been held in Europe and the United Kingdom), the Patents Act 1953 (NZ) should, if possible, be construed to have that effect, thereby discharging the obligations which New Zealand had undertaken by its accession to the TRIPs Agreement, particularly under Art 27(1). The Court of Appeal pointed out that a more logical approach, leading to the same result, would be to permit claims to extend to a method of treatment, by using the compound or composition, but to require from the patentee a disclaimer of any right to sue the medical practitioner485. 481 [1979-1985] EPOR B241 at 248-249. 482 [2000] 2 NZLR 529 at 538 [26]-[29]. 483 [1979] 2 NZLR 591. 484 [1983] NZLR 385. 485 [2000] 2 NZLR 529 at 547 [65]. United States of America Article 1, §8, cl 8 of the Constitution of the United States empowers Congress to legislate: "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries". Section 101 of the Patents Act 1952 defines patentable subject matter486: "Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title." The position in the United States has changed over time487. Early decisions which held that methods of medical treatment (including surgery) of the human body were not patentable488 were distinguished or overruled in 1954 in Ex parte Scherer489. In Scherer, the Board of Appeals of the Patent Office stated490: "[I]t cannot be categorically stated that all ... methods [of treatment of the human body for some medical or surgical purpose] are unpatentable subject matter merely because they involve some treatment of the human body." In Diamond v Chakrabarty491, it was decided that live, human-made microorganisms were patentable subject matter within the statutory requirements of the Patents Act 1952. This was because the bacterium was new and had 486 35 USC §101. 487 Chisum, Chisum on Patents, (2011), vol 1, §1.03[3]. 488 Morton v New York Eye Infirmary 17 F Cas 879 (1862); Ex Parte Brinkerhoff (1883), reported in (1945) 27 Journal of the Patent Office Society 797. 489 103 USPQ 107 (1954) ("Scherer"). 490 103 USPQ 107 at 109 (1954). "markedly different characteristics from any found in nature"492. In the course of delivering the opinion of the Court, Burger CJ stated that although §101 may have been intended to "include anything under the sun that is made by man", three implied exceptions, the laws of nature, physical phenomena and abstract ideas, constrained what was patentable493. A method or process of medical treatment of the human body, dependent on the laws of nature, will not be "patent-eligible"494 if a claim does no more than simply recite or describe, rather than apply, a law of nature495. Absent claims, including method claims, applying a law of nature, even a medically significant discovery or breakthrough may fall within the laws of nature exception to patentability. For example, composition claims to a naturally occurring deoxyribonucleic acid (DNA) segment, focussing on the genetic information encoded in two genes associated with certain cancers, have been held to claim subject matter falling within the exception, even though such important and useful genes had never before been located, or isolated from surrounding genetic material496. It appears that significant numbers of patents have been granted in the United States in respect of methods of medical treatment of the human body (including surgery)497. Sanofi was able to point to an example where a method of treatment claim was in similar form to claim 1 of the Patent498. However, after an eye surgeon sued other surgeons for patent infringement in respect of a new technique for cataract surgery499, the Patents Act 492 447 US 303 at 310 (1980). 493 447 US 303 at 309 (1980). 494 See Bilski v Kappos 177 L Ed 2d 792 (2010); Mayo Collaborative Services v Prometheus Laboratories Inc 132 S Ct 1289 (2012). 495 Mayo Collaborative Services v Prometheus Laboratories Inc 132 S Ct 1289 at 496 Association for Molecular Pathology v Myriad Genetics Inc 133 S Ct 2107 at 497 Dworkin, "Patents Relating to Methods of Medical Treatment", in Hansen (ed), International Intellectual Property Law & Policy, (2001), vol 6 at 12-17 and 12-24. 498 Merck & Co Inc v Teva Pharmaceuticals USA Inc 395 F 3d 1364 (2005). 499 Pallin v Singer 36 USPQ 2d 1050 (1995). 1952 was amended by the inclusion of §287(c), the effect of which is to permit the patenting of surgical methods to continue but to bar actions for patent infringement against medical practitioners (and "related health care entit[ies]") for "the performance of a medical or surgical procedure on a body". Canada Section 2 of the Patent Act500 defines an "invention" as "any new and useful art, process, machine, manufacture or composition of matter, or any new and useful improvement in any art, process, machine, manufacture or composition of matter". It contains no express exclusion from patentability of methods of medical treatment of the human body. The Supreme Court of Canada has held that such methods are not patentable501. However, a novel use of a known compound is considered patentable subject matter502. Applying that approach, in Apotex Inc v Wellcome Foundation Ltd503 the Supreme Court upheld a claim to the use of a known drug, AZT, in the following form504: "A pharmaceutical formulation comprising an amount of (AZT) effective for the treatment or prophylaxis of an AIDS infection, in association with a pharmaceutically accepted carrier." Canada's Manual of Patent Office Practice states that such "use" claims are permitted, as long as they do not include a medical or surgical step. For example, a claim to the "[u]se of compound Y as an antiarrhythmic agent" is considered acceptable505. However, a claim encompasses non-patentable subject 500 RSC 1985, c P-4. 501 Tennessee Eastman Co v Commissioner of Patents [1974] SCR 111; see also Shell Oil Co v Commissioner of Patents [1982] 2 SCR 536 at 554. 502 Shell Oil Co v Commissioner of Patents [1982] 2 SCR 536 at 549. 503 [2002] 4 SCR 153 at 177; see also GlaxoSmithKline Inc v Canada (Minister of Health) (2003) 28 CPR (4th) 307 at 318 [30]. 504 See Apotex Inc v Wellcome Foundation Ltd (2000) 195 DLR (4th) 641 at 672 505 Canadian Intellectual Property Office, Manual of Patent Office Practice, (1998) at matter when it "covers an area for which a physician's skill or judgment is expected to be exercised"506. Sanofi submitted that in these overseas jurisdictions the subject matter of claim 1 would be patentable, either directly as a method of treatment or through one of the drafting devices referred to above. Can methods of medical treatment of the human body be patentable inventions? Claim 1, for a method of preventing or treating psoriasis, claims a hitherto unknown therapeutic use of a pharmaceutical substance which was first disclosed, together with prior therapeutic uses, in Patent 341 (now expired). Apotex's submissions, derived from obiter dicta in the NRDC Case, that the subject matter of claim 1 is "essentially non-economic" must be rejected. law, First, the context of patent the expression "essentially non-economic" takes its meaning from the long-understood requirement that the subject matter of a patent (whether a product, or a method or process) must have some useful application, that is, must be capable of being practically applied in commerce or industry. A requirement that an invention have "economic utility" raises the same considerations as the requirement in the Patents Act 1977 (UK) and the EPC that an invention must be susceptible or capable of industrial application. So much is apparent from the definition of "exploit" in the 1990 Act, referring to products and to methods or processes, and the case law developed and applied for a very long time in respect of the requirement of utility507, now found in ss 18(1)(c) and 18(1A)(c). Secondly, the 1990 Act contains no specific exclusion from patentability of methods of medical treatment of the human body, nor can any be implied. Section 133, which provides for compulsory licensing, is in general terms and covers both patented articles and patented methods or processes. Section 70, providing for extensions of term in respect of pharmaceutical substances that are defined in terms of effects on the human body, infers that patents which claim a method of treatment of the human body can be granted, but not extended. Section 119A, the operation of which has been explained above, defines a "pharmaceutical patent" to include method patents for using or administering a pharmaceutical substance. 506 Janssen Inc v Mylan Pharmaceuticals ULC [2010] FC 1123 at [26] (a dosing regimen of a pharmaceutical). 507 See generally Eli Lilly and Co v Human Genome Sciences Inc [2008] RPC 733. Parliament accepted the IPAC's recommendation that the 1990 Act should not include a codification of requirements for patentability. Section 119A, described above, was introduced in 2006. It can be noted that Parliament has amended the 1990 Act 24 times since its enactment, including 20 times since the TRIPs Agreement entered Relevantly, amendments to the 1990 Act following the TRIPs Agreement did not enact Art 27(3) into Australian domestic law. That Article gives contracting States the option to exclude methods of medical treatment of the human body from patent protection. However, to construe s 18(1)(a) of the 1990 Act as excluding methods of medical treatment of the human body would be to introduce a lack of harmony between Australia and its major trading partners, where none exists at present. into force on 1 January 1995. Thirdly, as noted by the primary judge in Rescare Ltd v Anaesthetic Supplies Pty Ltd508, there is no normative distinction to be drawn from the provisions of the 1990 Act between methods of treatment of the human body which are cosmetic and those which are medical509. Fourthly, and critically, the subject matter of a claim for a new product suitable for therapeutic use, claimed alone (a product claim) or coupled with method claims (combined product/method claims)510, and the subject matter of a claim for a hitherto unknown method of treatment using a (known) product having prior therapeutic uses (a method claim)511, cannot be distinguished in terms of economics or ethics. In each case the subject matter in respect of which a monopoly is sought effects an artificially created improvement in human health, having economic utility. It could not be said that a product claim which includes a therapeutic use has an economic utility which a method or process claim for a therapeutic use does not have. It could not be contended that a patient free of psoriasis is of less value as a subject matter of inventive endeavour than a crop free of weeds. Patent monopolies are as much an appropriate reward for research into hitherto unknown therapeutic uses of (known) compounds, which uses benefit mankind, as they are for research directed to novel substances or compounds for therapeutic use in humans. It is not possible to erect a distinction between such research based on public policy considerations. 508 (1992) 111 ALR 205. 509 (1992) 111 ALR 205 at 239. 510 As in claims 1 and 4 of Patent 341. 511 As in claim 1 of the Patent. Fifthly, leaving aside, for the moment, the relevant obiter dicta in the NRDC Case, a method claim in respect of a hitherto unknown therapeutic use of a (known) substance or compound satisfies the general principle laid down in the NRDC Case. Such a method belongs to a useful art, effects an artificially created improvement in something, and can have economic utility. The economic utility of novel products and novel methods and processes in the pharmaceutical industry is underscored by s 119A of the 1990 Act and by their strict regulation in the Therapeutic Goods Act 1989 (Cth) ("the TGA"). Sixthly, while not determinative of the construction issue, the practice of the Australian Patent Office, following Joos (which practice was in evidence in Rescare, and about which there was no negative evidence led in this case), is consonant with Art 27(1) of the TRIPs Agreement. Seventhly, the obiter dicta in the NRDC Case, upon which Apotex relied, conveys some hesitation about "putting aside" methods of treatment of the human body512. That hesitation arose in circumstances where this Court was not called upon to decide whether the position under the 1952 Act, in relation to methods of medical treatment of humans, differed from the position in the United Kingdom under the Patents Act 1949 (UK) and case law in the United Kingdom following Re C & W's Application513. In other respects, the decision in the NRDC Case diverged from the case law in the United Kingdom, not only in respect of a "vendible product" requirement for a patentable process, but also in respect of the eligibility of agricultural products for patenting. The obiter dicta plainly refers to medical treatments, which are readily distinguishable from therapeutic uses of pharmaceutical substances as defined in the 1990 Act. Conclusion on patentability Assuming that all other requirements for patentability are met, a method (or process) for medical treatment of the human body which is capable of satisfying the NRDC Case test, namely that it is a contribution to a useful art having economic utility, can be a manner of manufacture and hence a patentable invention within the meaning of s 18(1)(a) of the 1990 Act. There is, however, a distinction which can be acknowledged between a method of medical treatment which involves a hitherto unknown therapeutic use of a pharmaceutical (having prior therapeutic uses) and the activities or procedures of doctors (and other medical staff) when physically treating patients. Although it is unnecessary to decide the point, or to seek to characterise such 512 NRDC Case (1959) 102 CLR 252 at 270. 513 (1914) 31 RPC 235. activities or procedures exhaustively, speaking generally they are, in the language of the NRDC Case, "essentially non-economic" and, in the language of the EPC and the Patents Act 1977 (UK), they are not "susceptible" or "capable" of industrial application. To the extent that such activities or procedures involve "a method or a process", they are unlikely to be able to satisfy the NRDC Case test for the patentability of processes because they are not capable of being practically applied in commerce or industry, a necessary prerequisite of a "manner of manufacture". Apotex's claim for revocation of the Patent, on the ground that claim 1 does not disclose a patentable invention, cannot succeed and should stand dismissed. Construction of claim 1 Claim 1 is recognisably a claim limited to the specific purpose of preventing and treating psoriasis. Given the prior art, any novelty and inventive step reposes in, and is confined to, that hitherto unknown therapeutic use of leflunomide. The compound (with prior therapeutic uses) was disclosed in Patent 341. The monopoly granted in respect of claim 1 is limited to the purpose (hitherto undiscovered) for which the (known) compound can be used. Drawing on jurisprudence in Europe and the United Kingdom, Apotex contended that in Australia, a hitherto unknown therapeutic use of a substance (having prior therapeutic uses) is not a manner of manufacture. This appeared to be a reinvigorated attack on novelty, or a suggestion of obviousness, in the guise of a s 18(1)(a) objection, stimulated by the construction of claim 1 favoured by the primary judge. Reliance was placed on the circumstance that there is no equivalent in the 1990 Act to sub-ss (3) and (4) of s 4A of the Patents Act 1977 (UK), which "deem" novel known substances and compounds in respect of their first and subsequent (hitherto unknown) therapeutic uses. Those deeming provisions are the legislative response in the United Kingdom to the express exclusion from patentability of pharmaceutical method patents, from which the 1990 Act is free. Novelty of purpose can confer novelty even if a substance is known, a principle determined in the NRDC Case, which can be seen in the relevant passages extracted above. Provided a hitherto unknown therapeutic use of a pharmaceutical substance or compound can satisfy the requirements of novelty and inventive step and is not obvious, such a use can be an invention within the meaning of s 18(1)(a) of the 1990 Act, irrespective of whether it is a first or subsequent novel use. It is true, as noted above and as contended by Apotex, that a claim in a patent specification limited to a hitherto unknown use of a substance (with prior therapeutic uses) may pose difficulties in the context of infringement, as observed by Lord Hoffmann in the Merrell Dow Case514. Nevertheless, for the reasons given, Apotex's second attack on the validity of claim 1 of the Patent must also be rejected. Infringement Infringement proceedings may be brought to enforce the exclusive rights granted to a patentee under s 13 of the 1990 Act to "exploit" an invention, as that term is defined in Sched 1, for the term of the patent. Infringement is determined by reference to those exclusive rights. Claim 1, for a hitherto unknown therapeutic use of a pharmaceutical substance (having prior therapeutic uses), is limited to the purpose of treating or curing psoriasis and cannot be directly infringed by the exploitation of leflunomide for the treatment of PsA. However, Sanofi's claim of infringement rests on s 117 of the 1990 Act, headed "Infringement by supply of products", which sets out the conditions under which a supply of a product will constitute an infringement of an indirect or contributory kind. Section 117 relevantly provides: If the use of a product by a person would infringe a patent, the supply of that product by one person to another is an infringement of the patent by the supplier unless the supplier is the patentee or licensee of the patent. (2) A reference in subsection (1) to the use of a product by a person is a reference to: if the product is not a staple commercial product—any use of the product, if the supplier had reason to believe that the person would put it to that use; or in any case—the use of the product in accordance with any instructions for the use of the product, or any inducement to use the product, given to the person by the supplier or contained in an advertisement published by or with the authority of the supplier." 514 [1996] RPC 76. The TGA must also be considered in the context of the claim of infringement under s 117. The TGA provides for the establishment and maintenance of a national system of controls relating to the quality, safety, efficacy and timely availability of therapeutic goods that are used in Australia, whether produced in Australia or elsewhere, or exported from Australia515. "Therapeutic goods" are goods likely to be taken to be for "therapeutic use", which is, in turn, defined to include use in or in connection with "preventing, diagnosing, curing or alleviating a disease, ailment, defect or injury in persons"516. Therapeutic goods which are entered on the ARTG are taken to be "separate and distinct" from other therapeutic goods if they have "a different name", "different indications", or "different directions for use"517, amongst other things. Section 23(2)(ba) of the TGA provides that an application for registration or listing of therapeutic goods on the ARTG, in the case of a restricted medicine (which leflunomide is), must be accompanied by product information in the form approved under s 7D. Appendix 8518 of the Therapeutic Goods Administration's Australian Regulatory Guidelines for Prescription Medicines (2004)519 (which the parties agreed were applicable) stated that a product information document: "is to present a scientific, objective account of the medicine's usefulness and limitations as shown by the data supporting the application. It is to be devoid of promotional material." In relation to its supply of Apo-Leflunomide, Apotex's approved product information document contains the following statements: "INDICATIONS Apo-Leflunomide is indicated for the treatment of: 515 Therapeutic Goods Act 1989 (Cth), s 4(1)(a). 516 Therapeutic Goods Act 1989 (Cth), s 3(1). 517 Therapeutic Goods Act 1989 (Cth), s 16(1)(d), (e) and (f). 518 Now Guidance 8: Product Information, published on the website of the Therapeutic Goods Administration. 519 The Australian Regulatory Guidelines for Prescription Medicines have been updated and now consist of a series of web pages which replace the 2004 version of the Guidelines and their appendices. Active Rheumatoid Arthritis. Active Psoriatic Arthritis. Apo-Leflunomide is not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease." As mentioned, the primary judge held that despite those instructions, Apotex's approved product information document instructed rheumatologists to use leflunomide to treat psoriasis, thus engaging s 117(2)(c) of the 1990 Act. Turning to s 117, the legislative history of that section was outlined by this Court in Northern Territory v Collins520. The difficulties of enforcing a patentee's rights against indirect or contributory infringers under the common law rules, described by Dixon J in Walker v Alemite Corporation521, were also considered by the IPAC report, to which reference has already been made. Recommendation 33 of the report, subsequently accepted522, stated that "in general the supply of goods whose only use would infringe a patent, or which are accompanied by a positive inducement for the ultimate consumer to perform actions which would innocently or knowingly infringe a patent should itself be an infringement of the patent" (emphasis added). Whether a supply of a product is an infringement under s 117 depends on the nature of the product and the use or uses to which it is put. A decision of the Supreme Court of the United States, Dawson Chemical Co v Rohm & Haas Co523, is illustrative of the scope of s 117(2)(b) and (c) of the 1990 Act and was used by the IPAC to illustrate the need for relieving a patentee from indirect or contributory infringement. The patentee in Dawson (the respondent on appeal to the Supreme Court) owned a patented method claim for the use of an unpatented product to inhibit the growth of certain weeds. The appellants supplied the unpatented product to persons (which was not a direct infringement of the method patent) with instructions to apply the product in accordance with the patented method. Unanimously, the United States Court of Appeals for the Fifth Circuit found that the appellants' conduct constituted 520 (2008) 235 CLR 619 at 631 [44]-[45] per Hayne J, 642-645 [100]-[110] per Crennan J; [2008] HCA 49. 521 (1933) 49 CLR 643 at 658; [1933] HCA 39. 522 Australia, Senate, Patents Bill 1990, Explanatory Memorandum at 28 [170]. 523 448 US 176 (1980) ("Dawson"). contributory infringement of the patent524. That finding was not disputed on appeal to the Supreme Court525. Having regard to the definition of "exploit" in relation to a "method" in the 1990 Act, which must be read with s 117, a person who supplies Apo-Leflunomide, but does not use the patented method to do any act set out in the definition of "exploit" referable to method patents, does not directly infringe the method patent. It is difficult to understand how the supply of an unpatented product, the use of which by a supplier would not infringe a method patent, can give rise to indirect infringement of a method patent by a recipient of the unpatented product from the supplier. The difficulty reflects the prior art and Sanofi's limited novelty in the hitherto unknown therapeutic use of the pharmaceutical substance, which is the claimed subject matter of the Patent. item registered on Further and separately, as an the ARTG, Apo-Leflunomide is a therapeutic good registered for its indicated uses, which specifically exclude use of the patented method identified in claim 1. In light of the provisions of the TGA, to which reference has been made, the expression "indication" in the product information document is an emphatic instruction to recipients of Apo-Leflunomide from Apotex to restrict use of the product to uses other than use in accordance with the patented method in claim 1. Apotex's approved product information document does not instruct recipients to use the unpatented pharmaceutical substance, which it proposes to supply, in accordance with the patented method, and therefore the product information document does not engage s 117(2)(c) of the 1990 Act. For the purposes of the application of s 117(2)(b), it was not shown, nor could it be inferred, that Apotex had reason to believe that the unpatented pharmaceutical substance, which it proposes to supply, would be used by recipients in accordance with the patented method, contrary to the indications in Apotex's approved product information document. Conclusion on infringement For the reasons given, Apotex's proposed supply of Apo-Leflunomide does not engage s 117(2)(b) and (c). Thus, Sanofi's claim of infringement, resting on s 117 of the 1990 Act, fails. 524 Rohm and Haas Co v Dawson Chemical Co 599 F 2d 685 at 688 (1979). 525 Dawson 448 US 176 at 185-186 (1980). Orders We would make the following orders. Matter No S1 of 2013 Appeal dismissed with costs. Matter No S219 of 2012 Special leave to appeal on ground 3 of the Draft Notice of Appeal filed on 10 September 2012 granted. Appeal allowed with costs. Set aside the orders of the Full Court of the Federal Court of Australia made on 18 July 2012 and, in their place, order that: the appeal be allowed in part; orders 2, 3 and 6 of the Federal Court made on 18 November 2011 be set aside; order 1 of the Federal Court made on 24 February 2012 be set aside; and so much of the Amended Application dated 22 September 2009 as made in paragraphs 14 to 22 be dismissed. Remit the matter to the Full Court on the questions of the costs of the appeal to that Court and the costs of the trial (which latter question may, at the discretion of the Full Court, be remitted to the primary judge). 307 National Research Development Corporation v Commissioner of Patents ("NRDC") held that a process must have "two essential qualities" to be recognised as a manner of manufacture within the meaning of s 6 of the Statute of Monopolies 1623 (21 Jac I c 3). First, the process must result in an "artificially created state of affairs". Secondly, that resultant state of affairs must have "its own economic utility"526. NRDC suggested, without deciding, that "processes for treating the human body may well lie outside the concept" of a manner of manufacture "because the whole subject is conceived as essentially non-economic"527. Underlying that suggestion was a reluctance to characterise as having economic utility a state of affairs, created by treatment of the human body, which might in different gradations be described as an "improvement in ... physical welfare" or as "relief of suffering"528. NRDC nevertheless emphasised: that the purpose of s 6 of the Statute of Monopolies was to "encourage national development"529; that "a widening conception" of manner of manufacture "has been a characteristic of the growth of patent law"530; and that any attempt to fetter the exact meaning of manner of manufacture was "unsound to the point of folly" 531. The evolution of the conception continued. The suggestion that all processes for treating the human body might lie outside the concept of a manner of manufacture did not survive Joos v Commissioner of Patents532. The holding in Joos was that a process which produced a cosmetic result lay within the concept of a manner of manufacture533. Whether processes for treating the 526 (1959) 102 CLR 252 at 277; [1959] HCA 67. See also Wellcome Foundation Ltd v Commissioner of Patents (1980) 145 CLR 520 at 528; [1980] HCA 21. 527 (1959) 102 CLR 252 at 275, citing Maeder v Busch (1938) 59 CLR 684 at 706; [1938] HCA 8. 528 Maeder v Busch (1938) 59 CLR 684 at 706. 529 (1959) 102 CLR 252 at 271. 530 (1959) 102 CLR 252 at 270. 531 (1959) 102 CLR 252 at 271. See also Lockwood Security Products Pty Ltd v Doric Products Pty Ltd [No 2] (2007) 235 CLR 173 at 201 [66]; [2007] HCA 21. 532 (1972) 126 CLR 611; [1972] HCA 38. 533 (1972) 126 CLR 611 at 618. human body which produced therapeutic or prophylactic results lay inside or outside the concept of a manner of manufacture remained undecided. Neither party to this appeal suggested that Joos was wrongly decided at the time or that its precise holding should now be revisited. When s 18(1)(a) of the Patents Act 1990 (Cth) ("the Act") incorporated the concept of a manner of manufacture within the meaning of s 6 of the Statute of Monopolies into the definition of a "patentable invention" for the purposes of the Act, the holding in Joos represented the minimum extent to which the conception of a manner of manufacture within the meaning of s 6 of the Statute of Monopolies had relevantly developed. Whether all processes for treating the human body ought now to be recognised as within the concept of a manner of manufacture within the meaning of s 6 of the Statute of Monopolies as incorporated by s 18(1)(a) of the Act, other than those specifically excluded by s 18(2)-(4) of the Act, need not be determined. The principal issue in the appeal can be resolved by asking and answering a narrower question. That narrower question is whether a process of using a pharmaceutical product to produce a therapeutic or prophylactic result ought now to be recognised as within that concept as so incorporated534. The seven reasons given by Crennan and Kiefel JJ for concluding that methods of medical treatment of the human body can be patentable inventions persuade me to answer that narrower question "yes". The fourth reason is to me the strongest. Black CJ and Lehane J gave it in Bristol-Myers Squibb Co v F H Faulding & Co Ltd in the form of a rhetorical question: "if (say) an antivenene for spider bite is patentable, on what ground can a new form of treatment for the same life-threatening bite be denied?"535 Where the new form of treatment is use of another pharmaceutical product, I can think of no satisfactory answer. In particular, I know of no reason for thinking in principle (and am aware of no data which suggest) that such net national economic benefit as might potentially result from the availability of a patent would be greater in the case of a patent for a pharmaceutical product than in the case of a patent for a process by which another pharmaceutical product is used to produce the same therapeutic or prophylactic result. To the seven reasons given by Crennan and Kiefel JJ, I would add an eighth. Irrespective of the weight now to be accorded to the earlier 534 Cf Apotex Inc v Wellcome Foundation Ltd [2002] 4 SCR 153 at 177 [48]-[50], citing Shell Oil Co v Commissioner of Patents [1982] 2 SCR 536 at 549, 554. 535 (2000) 97 FCR 524 at 530 [17]. administrative practice to which Crennan and Kiefel JJ point, an affirmative answer to the question whether a process of using a pharmaceutical product to produce a therapeutic or prophylactic result ought to be recognised as within the conception of a manner of manufacture within the meaning of s 6 of the Statute of Monopolies as incorporated by s 18(1)(a) of the Act was given unequivocally and unanimously by the Full Court of the Federal Court in 2000 in Bristol-Myers Squibb. As Bennett and Yates JJ emphasised in their joint reasons for judgment in the decision under appeal, the position reached in Bristol-Myers Squibb has since been regarded as "representing orthodoxy in Australian patent law"536. That judicially sanctioned orthodoxy was assumed in the framing of the definition of "pharmaceutical patent" in s 119A of the Act, introduced into the Act in 2006. Now to substitute a negative answer would depart from that orthodoxy; disappoint commercial expectations legitimately formed and acted upon for at least 13 years; undermine the legislative assumption made seven years ago; and render the current legislative definition in part redundant. I also agree with Crennan and Kiefel JJ in relation to the separate issue of construction in the appeal and in relation to the issue of infringement raised by the application for special leave to appeal. I therefore join in making the orders their Honours propose. 536 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) (2012) 204 FCR 494 at

HIGH COURT OF AUSTRALIA SZFDE & ORS AND APPELLANTS MINISTER FOR IMMIGRATION AND CITIZENSHIP & ANOR RESPONDENTS SZFDE v Minister for Immigration and Citizenship [2007] HCA 35 2 August 2007 ORDER 1. Appeal allowed with costs. 2. Set aside the orders of the Full Court of the Federal Court of Australia entered on 24 October 2006 and, in their place, order that the appeal to that Court be dismissed with costs. On appeal from the Federal Court of Australia Representation G C Lindsay SC with L J Karp for the appellants (instructed by Legal Aid Commission of New South Wales) R T Beech-Jones SC with G T Johnson for the first respondent (instructed by Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS SZFDE v Minister for Immigration and Citizenship Immigration – Refugees – The Refugee Review Tribunal ("the Tribunal") affirmed a decision refusing the appellants' application for protection visas – The appellants did not attend the Tribunal hearing as a result of fraudulent advice given by a purported registered migration agent – Whether there was fraud "by" or "on" the Tribunal. Immigration – Refugee Review Tribunal – Inquisitorial process – Distinction between Tribunal process and inter partes litigation – Whether fraud practised by an agent upon the applicants for a protection visa subverted the operation of Div 4 of Pt 7 of the Migration Act 1958 (Cth) – Whether this fraud led to the jurisdiction of the Tribunal remaining constructively unexercised. Administrative law – Constitutional writs – Mandamus and certiorari – Availability of constitutional writs in cases of fraud. Words and Phrases – "bad faith", "does not appear", "fraud", "on the decision maker", "third party fraud". Migration Act 1958 (Cth), Pt 7 Div 4, ss 281, 422B, 425, 426A. GLEESON CJ, GUMMOW, KIRBY, HAYNE, CALLINAN, HEYDON AND CRENNAN JJ. This is an appeal from a decision of the Full Court of the Federal Court of Australia (Allsop and Graham JJ, French J dissenting)1. The Full Court on 3 October 2006 allowed an appeal by the Minister (the first respondent in this Court) against the grant by the Federal Magistrates Court (Scarlett FM)2 on 20 December 2005 of orders in the nature of certiorari and mandamus in respect of a decision of the Refugee Review Tribunal ("the Tribunal") (the second respondent in this Court). The Tribunal had affirmed the decision of a delegate of the Minister not to grant protection visas to the appellants. The Issues The appellants in order are a wife and husband and their children (born in 1988 and 1989); they are citizens of Lebanon who arrived in Australia on 27 February 2002. The appellant wife claimed a well-founded fear of persecution by reason of her published views questioning the position of women in the Islamic tradition. Her husband and children relied upon their family membership for their protection visa applications. In its reasons the Tribunal noted that the first appellant, although invited to do so, had not appeared before it and that there were relevant matters the Tribunal would have wished to explore with her. The ground upon which the appellants sought relief in the Federal Magistrates Court was that the decision of the Tribunal was affected by the fraud of Mr Fahmi Hussain. He was said to have represented himself to the appellants to be a solicitor and a migration agent licensed in accordance with Pt 3 (ss 275-332H) of the Migration Act 1958 (Cth) ("the Act"). The first appellant paid Mr Hussain a total of $8,400 (and lent him $5,000) for him to act for the family with respect to the Tribunal proceeding. She followed his advice, in particular, not to attend the Tribunal hearing for which s 425 of the Act provides. The application to the Tribunal for review of the decision of the delegate of the Minister was made on 29 September 2002. By resolution of the Council of the Law Society of New South Wales on 5 December 2001 Mr Hussain's practising certificate had been cancelled. A letter of notification of the 1 Minister for Immigration and Multicultural Affairs v SZFDE (2006) 154 FCR 365. [2005] FMCA 1979. Crennan cancellation of his registration under Pt 3 of the Act had been given by the Migration Agents Registration Authority on 18 March 2002. This notification had been accompanied by detailed and adverse findings by the Authority on material questions of fact. At the foot of the letter there had appeared: "Your attention is directed to Division 2 of Part 3 of the Act which provides for penalties of up to 10 years imprisonment for the giving of immigration assistance or making immigration representations while not a registered agent." The appellants submit that this Court should uphold the reasoning in the dissenting judgment of French J in the Full Court. His Honour was of the view that the Tribunal had fallen into jurisdictional error because, whilst it had made its decision blamelessly, it had acted pursuant to a process compromised by "third party fraud"3. The position taken by the Minister in submissions to this Court is that the principle articulated by French J is too wide; there must be fraud "by" or "on" the decision-maker and here any fraud was perpetrated on the appellants but neither "by" nor "on" the Tribunal. In resolving this appeal it is sufficient to accept the Minister's proposition without deciding whether it would be sufficient for the appellants to establish, for example, fraud "on" themselves as parties before the Tribunal. For the reasons that follow there was in this case fraud in the necessary sense which was perpetrated "on" the Tribunal, as well as upon the appellants. The result was that, in law, the jurisdiction of the Tribunal remained unexercised and mandamus and certiorari were appropriately ordered by the Federal Magistrates Court. "Fraud" in the law It is convenient first to consider the place of "fraud" in the framework of general legal principle. In his celebrated speech in Reddaway v Banham4, Lord (2006) 154 FCR 365 at 400. [1896] AC 199 at 221. Crennan Macnaghten spoke of the various guises in which fraud appears in the conduct of human affairs, saying "fraud is infinite in variety". A corollary, expressed by Kerr in his "Treatise on the Law of Fraud and Mistake"5, is that: "The fertility of man's invention in devising new schemes of fraud is so great, that the courts have always declined to define it ... reserving to themselves the liberty to deal with it under whatever form it may present itself." Nevertheless, much judicial effort has been expended in exploring different shades of meaning, and sometimes deeper distinctions, in the constituents of "fraud" in various areas of the law. Recent decisions in this Court respecting "fraud" concern criminal law6, the tort of deceit7, registered designs law8, the law of agency9, statutes of limitation10 and dealings in Torrens title land11. Professor Hanbury12 described the common law and equity as having "quarrelled over the possession of the word 'fraud' like two dogs over a bone, off which neither side was sufficiently strong to tear all the meat", and said that the word fraud applied "indifferently to all failures in relations wherein equity set a 5 6th ed (1929) at 1 (footnote omitted). 6 Macleod v The Queen (2003) 214 CLR 230 at 241-242 [32]-[38]. 7 Krakowski v Eurolynx Properties Ltd (1995) 183 CLR 563 at 579-580. 8 Polyaire Pty Ltd v K-Aire Pty Ltd (2005) 221 CLR 287 at 295-296 [17]-[18]. 9 Sons of Gwalia Ltd v Margaretic (2007) 81 ALJR 525 at 543 [73]-[74]; 232 ALR 10 Commonwealth v Cornwell (2007) 81 ALJR 933 at 941-942 [40]-[45], 948-949 [74]-[75]; 234 ALR 148 at 158-159, 167-168. 11 Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 81 ALJR 1107 12 Modern Equity, 8th ed (1962) at 643-644. Crennan certain standard of conduct". Hence the attachment of the term "fraud" to the exercise of powers of appointment, and of other powers, such as those of company directors, in a fashion of which equity disapproved13. "Fraud" and Public Law In the fields of law just discussed, the common law, equity and statute are concerned principally with the creation and protection of personal and proprietary rights in inter partes litigation, rather than with what might today be identified as public law. This appeal concerns public law, in particular the due administration of the provisions of the Act respecting protection visas and procedures for review by the Tribunal of decisions on visa applications. That concern with due administration of the laws of the Commonwealth has the important constitutional underpinning described particularly in Plaintiff S157/2002 v Commonwealth14 and Bodruddaza v Minister for Immigration and Multicultural Affairs15 and identified with Ch III of the Constitution. The attachment by courts of equity of the term "fraud", with related notions of "bad faith" and "abuse of power", when stigmatising exercises of powers of appointment and fiduciary powers as falling short of the standards equity required of the repositories of those powers, has proved influential in the development of public law. What came to be known as the principle of "Wednesbury unreasonableness" was developed in the case law by analogy to the principles controlling the exercise of powers of discretions vested in trustees and others16. However, several points should be made here. First, given the equitable nature of their origins described above, principles of public law concerning impropriety in the exercise of statutory powers have not had the focus upon what might be called the "red blooded" species of fraud which engages the common law. Secondly, with respect to references in the public law decisions to good and 13 See the discussion by Dixon J in Mills v Mills (1938) 60 CLR 150 at 185. 14 (2003) 211 CLR 476 at 513-514 [103]-[104]. 15 (2007) 81 ALJR 905 at 910 [28], 913-914 [46]; 234 ALR 114 at 119, 123-124. 16 Minister for Immigration v Eshetu (1999) 197 CLR 611 at 649 [124]. Crennan bad faith and the like, the following observation in a leading English text17 is in point: "These add very little to the true sense, and are hardly ever used to mean more than that some action is found to have a lawful or unlawful purpose. It is extremely rare for public authorities to be found guilty of intentional dishonesty: normally they are found to have erred, if at all, by ignorance or misunderstanding. Yet the courts constantly accuse them of bad faith merely because they have acted unreasonably or on improper grounds. Again and again it is laid down that powers must be exercised reasonably and in good faith. But in this context 'in good faith' means merely 'for legitimate reasons'. Contrary to the natural sense of the words, they impute no moral obliquity." Aickin J made observations to similar effect in R v Toohey; Ex parte Northern Land Council18. Thirdly, in the present case the appellants do not challenge the description by French J of the Tribunal as having acted "blamelessly"19. But the appellants do direct attention to the effect upon the processes of the Tribunal of the dishonest acts and omissions of a third party, Mr Hussain. In this regard, the appellants pray in aid another generally expressed precept drawn from private law and from the significance of dishonesty in the litigation of private rights. This is expressed in the oft-repeated proposition that whilst on one hand fraud may be infinite, on the other hand "fraud unravels everything". How much does "fraud" unravel? In Lazarus Estates Ltd v Beasley20 Denning LJ declared: 17 Wade and Forsyth, Administrative Law, 9th ed (2004) at 416. 18 (1981) 151 CLR 170 at 232-233. See also Western Australian Planning Commission v Temwood Holdings Pty Limited (2004) 221 CLR 30 at 67 [93], 95 19 (2006) 154 FCR 365 at 400. 20 [1956] 1 QB 702 at 712-713. Crennan "No court in this land will allow a person to keep an advantage which he has obtained by fraud. No judgment of a court, no order of a Minister, can be allowed to stand if it has been obtained by fraud. Fraud unravels everything. The court is careful not to find fraud unless it is distinctly pleaded and proved; but once it is proved, it vitiates judgments, contracts and all transactions whatsoever: see as to deeds, Collins v Blantern21; as to judgments, Duchess of Kingston's case22; and as to contracts, Master v Earlier, speaking in this Court of a fraudulently obtained trade mark registration, Williams J said in Farley (Aust) Pty Ltd v JR Alexander & Sons (Q) Pty Ltd24: "Fraud is conduct which vitiates every transaction known to the law. It even vitiates a judgment of the Court. It is an insidious disease, and if clearly proved spreads to and infects the whole transaction (Jonesco v Beard25)." The vitiating effect of fraud is not universal throughout the law. The equitable doctrine protecting bona fide purchases for value and without notice is an important exception. Further, particular principles, or at least practices, have been developed with respect to collateral attacks in later litigation upon the outcome in earlier litigation where this was alleged to have been vitiated by fraud26. It has been said in this Court that, except in very exceptional cases, fraud constituted by perjury by a witness or witnesses acting in concert is not a 21 (1767) 1 Smith's LC, 13th ed, 406; 2 Wils KB 341 [95 ER 847]. 22 (1776) 2 Smith's LC 13th ed 644 at 646, 651; 20 How St Tr 355 at 538-539, 23 (1791) 1 Smith's LC 13th ed 780 at 799. 24 (1946) 75 CLR 487 at 493. 25 [1930] AC 298 at 301-302. 26 Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd (No 2) (1992) 37 FCR Crennan sufficient ground for setting aside a judgment27. The precept engaged here has been identified as that favouring the finality of litigation28. The authorities in this field concern adjudication of civil actions and suits. A rather different trend has appeared in public law, particularly respecting the administration by superior courts of certiorari to supervise the exercise of jurisdiction by inferior courts and tribunals. In Craig v South Australia29, Brennan, Deane, Toohey, Gaudron and McHugh JJ said of the scope of certiorari30: "Where available, certiorari is a process by which a superior court, in the exercise of original jurisdiction, supervises the acts of an inferior court or other tribunal. It is not an appellate procedure enabling either a general review of the order or decision of the inferior court or tribunal or a substitution of the order or decision which the superior court thinks should have been made. Where the writ runs, it merely enables the quashing of the impugned order or decision upon one or more of a number of distinct established grounds, most importantly, jurisdictional error, failure to observe some applicable requirement of procedural fairness, fraud and 'error of law on the face of the record'. Where the writ is sought on the ground of jurisdictional error, breach of procedural fairness or fraud, the superior court entertaining an application for certiorari can, subject to applicable procedural and evidentiary rules, take account of any relevant material placed before it" (footnotes omitted). Their Honours noted31 that in this context "fraud" was used in a broad sense which encompasses "bad faith". 27 See the remarks of Windeyer J in McDonald v McDonald (1965) 113 CLR 529 at 544, citing those of Williams J in Cabassi v Vila (1940) 64 CLR 130 at 147-148. 28 Owens Bank Ltd v Bracco [1992] 2 AC 443 at 483. See also D'Orta-Ekenaike v Victoria Legal Aid (2005) 223 CLR 1 at 20 [43]. 29 (1995) 184 CLR 163. 30 (1995) 184 CLR 163 at 175-176. 31 (1995) 184 CLR 163 at 176, fn 58. Crennan So strong was the policy protecting the due administration of justice, that a privative clause by which the legislature sought to exclude or attenuate the jurisdiction of superior courts to issue certiorari was ineffective to exclude the remedy where "manifest fraud" was shown on the part of the party which had obtained the order in the inferior court32. Further, it was held in R v Wolverhampton Crown Court; Ex parte Crofts33 that the double jeopardy rule had no application where the Queen's Bench Division granted certiorari to quash an order of acquittal obtained on the perjured evidence of the appellant to Quarter Sessions against his conviction by Justices; the effect of certiorari was to leave standing the regularly obtained conviction. In Davern v Messel34 Mason and Brennan JJ saw Crofts as displaying a proper balance between the protection of the defendant as the weaker party in a criminal case and the interests of society in ensuring the due administration of justice. In Al-Mehdawi v Secretary of State for the Home Department35 Lord Bridge of Harwich gave as an example of "the principle that fraud unravels everything" a line of authority which he identified as follows: "In R v Gillyard36 the court quashed by certiorari a conviction by justices shown to have been obtained by fraud and collusion. This was followed in R v Recorder of Leicester37 and extended in R (Burns) v County Court Judge of Tyrone38 to allow the quashing of an affiliation order obtained on the strength of perjured evidence of witnesses called to furnish the 32 The Colonial Bank of Australasia v Willan (1874) LR 5 PC 417 at 442; Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992 at 1002-1003 [55]-[56]; 207 ALR 12 at 25-26. 33 [1983] 1 WLR 204 at 207. 34 (1984) 155 CLR 21 at 58-59. 35 [1990] 1 AC 876 at 895. 36 (1848) 12 QB 527 [116 ER 965]. Crennan required corroboration of the evidence of the complainant, although it was not shown that the complainant herself was party to the perjury." When extending certiorari to cases of "third party fraud" in R (Burns) v County Court Judge of Tyrone39, Lord MacDermott LCJ dealt as follows with the submission that the perjury must be by a party or the party must be privy to it40: "The supervisory jurisdiction of this court is not at large; but the general aim of that jurisdiction is to promote the due administration of justice, and if a distinction is to be drawn between cases where a decision is procured by perjury and cases where a decision is procured by perjury to which one of the parties is privy, it ought to rest on some basis of principle. I am unable to discern any such basis here. Litigation between parties, whether civil or criminal, does not necessarily mean that there are not others anxious or interested to sway the issue one way or the other, and it would, I think, be a grave defect in the procedure of this court if one of these forms of fraud could be noticed but not the other. I can find no rational ground for the sort of discrimination which must prevail if we are to accede to the submission under discussion. If certiorari does not lie in such circumstances there is no other redress and an order undoubtedly founded on perjury remains effective." The concern with the due administration of justice manifested in these decisions has been adapted in England to the position occupied in the legal system by administrative bodies and tribunals. For example, in R v Fulham, Hammersmith and Kensington Rent Tribunal; Ex parte Gormly41 Lord "if some collusive proceedings were taken, it would amount to a fraud on the tribunal, and where a fraud was proved I have little doubt that this court could intervene if necessary by an order of certiorari to get rid of a decision which the tribunal had been misled into making." 40 [1961] NI 167 at 172. 41 [1951] 2 All ER 1030 at 1034. Crennan In Australia, the constitutional considerations referred to earlier in these reasons place due administration of federal law within the field in which the superintendence of Ch III operates. There is another practical aspect of fraud in public law that may tend in a particular case to set it apart from fraud in relation to civil suits in general. It is that often a victim of it will have no useful remedy except to have the fraudulently affected result set aside and a fresh untainted hearing conducted. Ainsworth v Criminal Justice Commission42 is an example of the inadequacy of a conventional remedy such as damages. There they would, even if a cause of action arguably giving rise to them had been available, not only have been probably unquantifiable, but also not a useful remedy. The same may apply to some proceedings before administrative tribunals, for example, an application under the Freedom of Information Act 1982 (Cth). In the present case, the only remedy that would be of real utility to the appellants is an order that provides them with the opportunity to press their claims to a protection visa in a fair hearing conducted according to law. Experience in Australia With respect to certiorari to quash summary convictions by reason, for example, of guilty pleas fraudulently induced by the conduct of police officers, the reasoning in the English authorities has been applied in Australia43. The police officers in a sense are "third parties" in this setting, albeit persons in authority or acting under colour of authority. As the Act previously stood, s 476(1)(f) provided as a ground for judicial review by the Federal Court that the decision in question "was induced or affected by fraud". Lindgren J held in Wati v Minister for Immigration and Ethnic Affairs44 that the "fraud" was not limited to that of the decision-maker, a party, or a party's representative, but that the decision in question must be 42 (1992) 175 CLR 564. 43 R v The Justices at Biloela, Ex parte Marlow (No 2) [1983] 1 Qd R 552. 44 Wati v Minister for Immigration and Ethnic Affairs (1996) 71 FCR 103 at 112. Crennan actually induced or affected by the fraud. That reasoning was followed and applied by Lehane J in another s 476 (1)(f) case45. Before its repeal by the Migration Legislation Amendment (Judicial Review) Act 2001 (Cth), along with other provisions of Pt 8 of the Act, s 476 had limited the grounds for judicial review by the Federal Court but had retained the ground (s 476(1)(f)) that the decision was "induced or affected by fraud". The Minister submitted in Wati46 that what was required was actual inducement or affectation by fraud, on the balance of probabilities and with due regard to Briginshaw v Briginshaw47. Lindgren J accepted that submission but rejected the further submission that the "fraud" was limited to that of the decision-maker, a party or a party's representative. Lindgren J reasoned in Wati as follows48: "although the amending Act of 1992 [the source of s 476] limited the grounds of judicial review, I find no reason to think that the fraud referred to in s 476(1)(f) was intended to be limited in the way suggested by the Minister. Indeed, it is easy to accept that the legislature may have wished to ensure that a decision would be able to be reviewed where it was induced or affected by the fraud of some person. Assume, for example, that a decision of [the Immigration Review Tribunal ("the IRT")] adverse to an applicant for a protection visa had been procured by the fraud of the individual's opponents: in such a case, Australia would fail to observe its obligations under the Convention Relating to the Status of Refugees through no fault of the Minister or of the IRT, but as a result of a fraud perpetrated by others. It is not surprising to contemplate that the legislature might have wished, in such a case, that the fraud be able to be exposed and its effects remedied in this Court." 45 Jama v Minister for Immigration and Multicultural Affairs (2000) 61 ALD 387. 46 (1996) 71 FCR 103 at 111. 47 (1938) 60 CLR 336. 48 (1996) 71 FCR 103 at 112. Crennan The jurisdiction exercised in this case by the Federal Magistrates Court was not founded in the fully amplified system of statutory judicial review laid out in the repealed Pt 8 of the Act. Rather, it was conferred49 in terms referable to the conferral on the Court by s 75(v) of the Constitution itself. But that circumstance, given the significance of s 75(v) for due administration of federal law to which reference has been made earlier in these reasons, strengthens the case for its application to the appeal of reasoning akin to that of Lindgren J in The Present Appeal It is unnecessary for the resolution of the present appeal to determine at large and in generally applicable terms the scope for judicial review for "third party fraud" of an earlier administrative decision (whether a primary decision or, as in the case of the Tribunal, an administrative decision itself made as a system of external administrative review), where the applicant for judicial review did not collude in the fraud practised on the administrative decision-maker or review body and did not then learn of the fraud but complains of it in subsequent proceedings. Rather, the present appeal should be resolved after close attention to the nature, scope and purpose of the particular system of review by the Tribunal which the Act establishes and the place in that system of registered migration agents. Any application of a principle that "fraud unravels everything", requires consideration first of that which is to be "unravelled", and secondly of what amounts to "fraud" in the particular context. It then is necessary to identify the available curial remedy to effect the "unravelling". To these matters we now turn. 49 See ss 483A, 475A, of the Act and Judiciary Act 1903 (Cth), s 39B. With effect 1 December 2005, ss 483A and 475A were repealed by the Migration Litigation Reform Act 2005 (Cth) Sched 1, Pt 1, items 28, and 17 respectively. Subject to some qualifications, the Federal Magistrates Court now has, in relation to migration decisions, the same original jurisdiction as does this Court under s 75(v) of the Constitution. Explicit provision to that effect is now made by s 476 of the Act. Crennan Fraud on the Tribunal? Part 7 (ss 410-473) of the Act establishes a detailed regime for the review by the Tribunal of particular visa decisions. (Part 8 (ss 474-486Q) provides for Judicial Review). Division 4 of Pt 7 (ss 422B-429A) lays down the procedure for the conduct of reviews by the Tribunal. This differs significantly from the procedures of inter partes civil litigation. Of these differences, in Minister for Immigration and Multicultural Affairs v Wang50 Gummow and Hayne JJ remarked: "In adversarial litigation, findings of fact that are made will reflect the joinder of issue between the parties. The issues of fact and law joined between the parties will be defined by interlocutory processes or by the course of the hearing. They are, therefore, issues which the parties have identified. A review by the Tribunal is a very different kind of process51. It is not adversarial; there are no opposing parties; there are no issues joined. The person who has sought the review seeks a particular administrative decision – in this case the grant of a protection visa – and puts to the Tribunal whatever material or submission that person considers will assist that claim. The findings of fact that the Tribunal makes are those that it, rather than the claimant, let alone adversarial parties, considers to be necessary for it to make its decision." The importance of the requirement in s 425 that the Tribunal invite the applicant to appear to give evidence and present arguments is emphasised by s 422B52. This states that Div 4 "is taken to be an exhaustive statement of the requirement of the natural justice hearing rule in relation to the matters it deals with." 50 (2003) 215 CLR 518 at 540-541 [71]. See also at 526 [18] per Gleeson CJ, 531 51 Mahon v Air New Zealand Ltd [1984] AC 808 at 814; Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 282. 52 Added to Pt 7 Div 4 by the Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth). Crennan An effective subversion of the operation of s 425 also subverts the observance by the Tribunal of its obligation to accord procedural fairness to applicants for review. Given the significance of procedural fairness for the principles concerned with jurisdictional error, sourced in s 75(v) of the Constitution53, the subversion of the processes of the Tribunal in the manner alleged by the present appellants is a matter of the first magnitude in the due administration of Pt 7 of the Act. Section 425 of the Act states: The Tribunal must invite the applicant to appear before the Tribunal to give evidence and present arguments relating to the issues arising in relation to the decision under review. Subsection (1) does not apply if: the Tribunal considers that it should decide the review in the applicant's favour on the basis of the material before it; or the applicant consents to the Tribunal deciding the review without the applicant appearing before it; or subsection 424C(1) or (2) applies to the applicant. If any of the paragraphs in subsection (2) of this section apply, the applicant is not entitled to appear before the Tribunal." The consequence of failure to appear upon invitation under s 425 is spelled out in s 426A. This provides: If the applicant: is invited under section 425 to appear before the Tribunal; and 53 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82. Crennan does not appear before the Tribunal on the day on which, or at the time and place at which, the applicant is scheduled to appear; the Tribunal may make a decision on the review without taking any further action to allow or enable the applicant to appear before it. This section does not prevent from rescheduling the applicant's appearance before it, or from delaying its decision on the review in order to enable the applicant's appearance before it as rescheduled." the Tribunal What is the content of the expression "does not appear" in par (b) of s 426A(1)? Certainly it is a jurisdictional fact upon which depends the occasion for the exercise of the decision-making power of the Tribunal given by the balance of the subsection54. Further, sub-s 426A(2) enables the Tribunal to respond to cases of force majeure and the like which cause the applicant to fail to appear. In Minister for Immigration and Multicultural Affairs v Bhardwaj55 by error of the Tribunal it proceeded to determine a review application adversely to the applicant without having regard to a prior written adjournment application; the Tribunal, later being apprised of its error made a second decision (favourable to the applicant). A challenge by the Minister to the competency of the second decision failed in the Federal Court and in this Court. In argument on the present appeal the Minister accepted that if, before the Tribunal had made its decision, it had appreciated the position of the first appellant and the misconduct of Mr Hussain, but nevertheless had gone ahead, forthwith and without inviting the first appellant to appear before it, this would have "raised a real question" as to the miscarriage of the Tribunal's power under s 426A(1). Upon that view of the due administration of the Act, the legal quality of the Tribunal's decision becomes a question of dates. The principles of finality 54 See Minister for Immigration and Multicultural and Indigenous Affairs v SCAR (2003) 128 FCR 553 at 561; cf Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Palme (2003) 216 CLR 212 at 225 [44]-[46], 227-228 55 (2002) 209 CLR 597. Crennan in litigation and of the great significance attached to the entry of orders made by superior courts of record are well understood. But the first principle does not apply, and the second cannot apply, in administrative decision-making by the delegate of the Minister, or, as here, by the Tribunal which, by s 415, exercises all the powers and discretions of the delegate. But what of a case such as the present? Here, on the appellants' case, the decision not to appear, whilst consciously made, was the result of the fraudulent conduct of a third party, Mr Hussain, but neither the appellants nor the Tribunal appreciated the situation before the Tribunal made its decision. Before answering the question just posed, some further facts need to be understood. The Facts As noted in the passage in Craig56 which has been set out earlier in these reasons, in a case of alleged fraud the court exercising judicial review may, subject to any applicable procedural and evidentiary rules, take account of any relevant material placed before it. Further, Mr Hussain is absent from these proceedings, and a finding of fraud is a serious matter. But the identification of the motives of Mr Hussain in acting as he did may be a matter of inference drawn from the available material57. In drawing, or failing to draw, such inferences, the Federal Magistrates Court enjoyed no special position precluding a further examination by the Federal Court and, on appeal, this Court. The evidence of the first appellant was that when, with her husband, she met Mr Hussain to discuss the Tribunal's letter of invitation dated 27 June 2003 which invited attendance at a hearing of the Tribunal Mr Hussain used words to the effect: "It is best not to go. If you go they will refuse you. They are not accepting any visa applications at all at the moment. I am going to take a different approach. I am going to write a letter to the Minister. I am worried that if you go to the [Tribunal] you will say something in 56 (1995) 184 CLR 163 at 175-176. 57 See the discussion of principle by Lindgren J in Wati v Minister for Immigration and Ethnic Affairs (1996) 71 FCR 103 at 113-4. Crennan contradiction to what I will write. Don't worry. I'm doing what is best for you." A letter to the then Minister, dated 15 September 2003, was composed by Mr Hussain in the name of the second appellant. It was headed "Application for Consideration [under] Section 417 of the Migration Act". Section 417 conferred a power upon the Minister, if the Minister thought it was in the public interest to do so, to substitute for a decision of the Tribunal a decision more favourable to an applicant. This and further requests of this nature were rejected. The Federal Magistrate held that Mr Hussain had acted fraudulently in his dealings with the appellants for personal gain, that he had extracted money under false pretences and that the appellants had been dissuaded from attending the Tribunal hearing "by the fraudulent behaviour of Mr Hussain". The result was to have "deprived the invitation to the hearing [of] its quality of being a meaningful invitation under s 425". In the Full Court French J properly observed58: "The finding of fraud should have specified, in one place in the reasons, what was said that was fraudulent, how it was fraudulent, and how it was acted upon. The finding of fact that the magistrate made however was not challenged in these proceedings." In his reasons, French J developed the matter as follows59; "The agent held himself out to be a practising solicitor and registered migration agent. He was neither. He gave fraudulent advice that the Tribunal was 'not accepting any visa applications at all at the moment'. He expressed a false concern that if [the first appellant] and her family appeared before the Tribunal they would say something inconsistent with his proposed submission to the Minister. The advice amounted to a representation that the Tribunal process was a sham and that participation in it might prejudice [the first appellant's] prospects of a successful outcome on the basis of a submission to the Minister. 58 (2006) 154 FCR 365 at 383. 59 (2006) 154 FCR 365 at 399-400. Crennan The decision-making process, that is the process of review which incorporates an opportunity for a hearing on the conditions set out in Pt 7, was corrupted. The importance of the appearance before the Tribunal to the outcome of the review was highlighted by the Tribunal's reference, in its reasons, to matters which it did not have an opportunity to explore with [the first appellant] because of her non-appearance. On this basis, in my opinion, the decision of the Tribunal was vitiated. It was not a decision made under the Act and therefore not a privative decision protected by On the other hand Allsop J, one of the majority, expressed his conclusion for setting aside the relief granted by the Federal Magistrate as follows60: "A conscious choice was made by the [appellants] not to go to the hearing, which was influenced by the fraud of the agent. The complaints of the [appellants] are not about the process, but about their erstwhile agent who acted as he did. I do not consider that either the decision or the statutory process was corrupted by fraud." Graham J, the other member of the majority, reasoned61 that the sufficiency of an invitation to attend was to be addressed at the moment when it has been given and that, viewed in that way, any fraudulent advice could not bear upon the question of whether or not an invitation had been duly given. But the relief by way of certiorari and mandamus which had been granted by the Federal Magistrate was directed not to compliance with the letter of s 425 but to the decision made by the Tribunal on its review of the decision of the delegate. Was that decision liable to impeachment by a remedy for fraud practised upon the Tribunal? Neither the reasons of the Federal Magistrate nor the dissenting reasons of French J in the Full Court considered in any detail the question of the motives of Mr Hussain in acting as he did with respect to the rejection of the invitation to attend the Tribunal hearing. The inference is well open upon the evidence that 60 (2006) 154 FCR 365 at 402. 61 (2006) 154 FCR 365 at 424. Crennan Mr Hussain acted as he did for self-protection, lest in the course of a Tribunal hearing there be revealed his apparently unlawful conduct in contravention of restrictions imposed by Pt 3 Div 2 of the Act, particularly by s 281. Section 281 relevantly provides: Subject to subsection (3), a person who is not a registered migration agent must not ask for or receive any fee or other reward for giving immigration assistance. Penalty: Imprisonment for 10 years. This section does not prohibit: a lawyer from asking for or receiving a fee for giving immigration legal assistance; or a person from asking for or receiving a fee for the giving of immigration legal assistance by a lawyer. (4) A person is not entitled to sue for, recover or set off any fee or other reward that the person must not ask for or receive because of subsection (1)." The term "lawyer" is so defined as to include a solicitor of the Supreme Court of a State. At the relevant time Mr Hussain was no longer a "lawyer" in this defined sense. Conclusions French J correctly identified the ultimate issue as the effect upon the Tribunal's decision-making process, for which the Parliament provided in Pt 7 of the Act62, of the fraud of Mr Hussain. As indicated earlier in these reasons, the provisions of Pt 7 obliging the Tribunal to invite the applicant to appear before it to give evidence and present 62 (2006) 154 FCR 365 at 399. Crennan arguments relating to the issues arising in relation to the decision under review (s 425(1)) and empowering the Tribunal to make a decision on the review in the absence of an appearance (s 426A) are of central importance for the legislative scheme laid out in Div 4 of Pt 7 (ss 422B-429A) for the conduct of reviews. By s 422B that Division provided that it is to be taken as an exhaustive statement of the requirements of the natural justice hearing rule. The fraud of Mr Hussain had the immediate consequence of stultifying the operation of the legislative scheme to afford natural justice to the appellants. That this is so is manifest by the reasons given by the Tribunal, which included the statement: "The [first] applicant was put on notice by the Tribunal that it is unable to make a favourable decision on the information before it but the applicant has not provided any further information in support of her claims. Nor has she given the Tribunal an opportunity to explore aspects of her claims with her. A number of relevant questions are therefore left unanswered. The Tribunal is not satisfied, on the evidence before it, that the applicant has a well-founded fear of persecution within the meaning of the Convention." Reference has been made earlier in these reasons to the submission for the Minister that any fraud perpetrated on the appellants was not a fraud "on" the Tribunal. Further, as noted above, Allsop J characterised the complaints of the appellants as not about the process but about their erstwhile agent and concluded that neither the decision nor the statutory process "was corrupted by fraud"63. However, as in other areas of legal debate, including questions of federal legislative power under the Constitution itself64, to say of a law or state of affairs that it bears one legal character does not necessarily deny it a second legal character which is of decisive significance. 63 (2006) 154 FCR 365 at 402. 64 Grain Pool of Western Australia v Commonwealth (2000) 202 CLR 479 at Crennan No doubt Mr Hussain was fraudulent in his dealings with the appellants. But the concomitant was the stultification of the operation of the critically important natural justice provisions made by Div 4 of Pt 7 of the Act. In short, while the Tribunal undoubtedly acted on an assumption of regularity, in truth, by reason of the fraud of Mr Hussain, it was disabled from the due discharge of its imperative statutory functions with respect to the conduct of the review. That state of affairs merits the description of the practice of fraud "on" the Tribunal. The consequence is that the decision made by the Tribunal is properly regarded, in law, as no decision at all. This is because, in the sense of the authorities, the jurisdiction remains constructively unexercised. The authorities were collected in Bhardwaj65. the outcome The significance of this appeal should not be misunderstood. The appeal has turned upon the particular importance of the provisions of Div 4 of Pt 7 of the Act for the conduct by the Tribunal of reviews and the place therein of the ss 425 and 426A. In the Full Court French J correctly emphasised that there are sound reasons of policy why a person whose conduct before an administrative tribunal has been affected, to the detriment of that person, by bad or negligent advice or some other mishap should not be heard to complain that the detriment vitiates the decision made66. The outcome in the present appeal stands apart from and above such considerations. Were the matter litigated in the original jurisdiction of this Court, the consequence would be that mandamus would lie under s 75(v) of the Constitution to compel the Tribunal to redetermine the review application according to law. In support of that remedy under s 75(v), certiorari would lie in respect of the purported decision of the Tribunal67. By reason of the terms of the conferral of jurisdiction upon the Federal Magistrates Court it was in a corresponding position. 65 (2002) 209 CLR 597 at 614-615 [51]. See, further, Plaintiff S157/2002 v Commonwealth (2003) 211 CLR 476 at 506 [76]. 66 (2006) 154 FCR 365 at 399. 67 Plaintiff S157/2002 v Commonwealth (2003) 211 CLR 476 at 507 [80]. Crennan The order of the Federal Magistrates Court granting orders in the nature of certiorari to quash, and mandamus requiring the Tribunal to redetermine according to law, the review of the decision of the delegate were properly made. That redetermination according to law will include the Tribunal giving the appellants, pursuant to s 425, a fresh invitation to appear before the Tribunal. Orders The appeal to this Court should be allowed with costs. The orders of the Federal Court entered on 24 October 2006 should be set aside and in place thereof the appeal to that Court should be dismissed with costs.

HIGH COURT OF AUSTRALIA FELICITY CASSEGRAIN APPELLANT AND GERARD CASSEGRAIN & CO PTY LTD RESPONDENT Cassegrain v Gerard Cassegrain & Co Pty Ltd [2015] HCA 2 4 February 2015 ORDER Appeal allowed in part. Set aside paragraphs 2 and 3 of the order of the Court of Appeal of the Supreme Court of New South Wales made on 18 December 2013 and, in their place: declare that the appellant holds a half interest in the property described Identifiers 4/792413, 1/798316, and 174/754434 on trust for the respondent absolutely; and in Folio order that the appellant execute a Real Property Act 1900 (NSW) transfer of a one-half interest in the property referred to in paragraph (a) to the respondent. The respondent pay the appellant's costs of the appeal to this Court. On appeal from the Supreme Court of New South Wales Representation D F Jackson QC with P J Gormly and L M Jackson for the appellant (instructed by Peter Condon & Associates) B W Walker SC with G B Colyer for the respondent (instructed by McCabes Lawyers Pty Limited) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Cassegrain v Gerard Cassegrain & Co Pty Ltd Real property – Torrens system land – Indefeasibility of title – Respondent company transferred property to appellant and appellant's husband ("Claude") – Claude acted fraudulently in purchasing property – Claude later transferred his interest in property to appellant for nominal consideration – Whether fraud brought home to appellant as registered proprietor or to her agent – Whether Claude appellant's agent – Whether appellant's title defeasible because Claude had acted as appellant's agent – Whether appellant's title defeasible because Claude and appellant were registered as joint tenants – Whether appellant's title defeasible because of Claude's fraud pursuant to s 118(1)(d) of Real Property Act 1900 (NSW). Words and phrases – "agent", "brought home to the person whose registered title is impeached or to his agents", "fraud", "joint proprietor", "joint tenant", "registered as proprietor of the land through fraud", "through". Real Property Act 1900 (NSW), ss 42(1), 100(1), 118(1). FRENCH CJ, HAYNE, BELL AND GAGELER JJ. The issues The registered proprietor of Torrens system land, a company, transferred the land to husband and wife as joint tenants for consideration to be satisfied by debiting the husband's loan account with the company. The husband knew that the company did not owe him the amount recorded in the loan account. The debit was not recorded in the company's books until after the transfer had been registered. The husband subsequently transferred his interest in the land to his wife for a nominal consideration. Is the wife's title, first as joint proprietor with her husband, or second deriving from or through her husband under the subsequent transfer, defeasible by the company? The issues are to be resolved by the proper construction and application of the relevant provisions of the Real Property Act 1900 (NSW) ("the RPA"), particularly s 42 (the paramountcy provision), s 100 (providing for registration as joint proprietors) and s 118 (protecting a registered proprietor from proceedings for the possession or recovery of land except in certain cases). These reasons will show that the wife's title as joint proprietor was not defeasible on account of her husband's fraud but that, the wife not being a bona fide purchaser for value of her husband's interest in the land, the interest which she derived from him (an interest as tenant in common as to half) is defeasible and may be recovered by the company. As may be expected, the facts which lie behind the issues require some elaboration. The facts The respondent company ("GC&Co") was registered under the RPA as proprietor of an estate in fee simple in land described in a number of Folio Identifiers. The land was referred to in the proceedings as the "Dairy Farm". Transfers of the Dairy Farm were registered, first from GC&Co to Claude Cassegrain and his wife, Felicity, as joint tenants, and second from Claude Cassegrain to Felicity. GC&Co sought to recover title as sole registered proprietor of the Dairy Farm from Felicity (the appellant in this Court). In 1993, GC&Co settled some proceedings it had brought against the Commonwealth Scientific and Industrial Research Organisation ("CSIRO"). In settlement of the claim, CSIRO paid GC&Co $9.5 million. Entries were made in the books of GC&Co to recognise a loan account of $4.25 million on the footing that this part of the money received by GC&Co from CSIRO was owed to Hayne Bell Claude Cassegrain, one of the company's two directors. In this Court, it was accepted that Claude Cassegrain was never entitled to any part of the settlement sum and that GC&Co never owed him any part of the amount recorded in the loan account created in the company's books. On 2 September 1996, Claude Cassegrain and his sister, Anne-Marie Cameron, who were then the directors of GC&Co, resolved to sell the Dairy Farm (and some associated assets) to Claude and Felicity Cassegrain as joint tenants. The directors further resolved, at the same meeting, that GC&Co should "debit the loan account of Claude Cassegrain in the books of the Company for the amount of the consideration payable ... and that the debiting of the ... loan account shall be full satisfaction of the amounts payable to the Company". In February 1997, Claude Cassegrain instructed a solicitor, Mr Chris McCarron, to register "the transfer as exchanged". The transfer was executed, as transferor, by GC&Co under its common seal, attested by its directors (Claude Cassegrain and Anne-Marie Cameron), and, for Claude and Felicity Cassegrain followed some correspondence between Mr McCarron and Claude about the progress of registration. In March 1997, Mr McCarron informed Claude that the transfer had been registered. transferees, by Mr McCarron as solicitor. There Although the transfer (dated 14 September 1996) acknowledged receipt of the agreed consideration of $1 million, the books of account of GC&Co recorded that Claude Cassegrain's loan account was debited with that amount on 30 June In 1996 (exactly when does not appear), four of Claude Cassegrain's siblings (Patrick, John, Denis and Catherine) brought oppression proceedings1 in the Federal Court of Australia against Claude, Anne-Marie, their mother, GC&Co, the trustees of the Cassegrain Family Trust and 14 other companies with which members of the family were associated. The plaintiffs alleged that acts by or on behalf of GC&Co (and the other companies) had been oppressive or unfairly prejudicial to them. In July 1998, Davies J declared2 (among other things) that Claude's conduct in treating the $4.25 million loan account as his 1 Under s 260 of the Corporations Law of New South Wales (as set out in s 82 of the Corporations Act 1989 (Cth): Corporations (New South Wales) Act 1990 (NSW), 2 Cassegrain v Cassegrain [1998] FCA 811. Hayne Bell entitlement to be drawn down at his will and in drawing upon that account was oppressive and unfairly prejudicial to the members of GC&Co. Nearly two years later, by a transfer dated 24 March 2000, Claude Cassegrain transferred "an estate in fee simple" in the Dairy Farm to Felicity Cassegrain for a consideration of $1. Again, Mr McCarron acted as solicitor. He witnessed Claude Cassegrain's signing of the transfer as transferor and signed it as solicitor for the transferee. GC&Co's claims More than eight years later, pursuant to leave granted in September 20083, Denis Cassegrain (one of the plaintiffs in the Federal Court oppression proceedings) brought a statutory derivative action in the Supreme Court of New South Wales on behalf of GC&Co against Claude and Felicity Cassegrain. As ultimately framed, the action sought orders requiring Felicity Cassegrain to transfer the title to the Dairy Farm to GC&Co and various orders against Claude Cassegrain, including equitable compensation for alleged breaches of his fiduciary duties as a director. GC&Co alleged that Claude's assertion of an entitlement to $4.25 million of the sum paid by CSIRO, and his causing the company to acknowledge that it was indebted to him in that amount, were fraudulent acts. GC&Co alleged that Claude "fraudulently obtained" the transfer of the Dairy Farm, that Claude and Felicity were registered as proprietors of the land through fraud and that Claude was Felicity's agent for the purpose of registering Felicity as joint tenant of the land pursuant to the transfer. GC&Co further alleged that, by the transfer of March 2000, Felicity derived the remaining interest in the land from a person registered as proprietor through fraud and otherwise than as a bona fide transferee for value, and that Claude was Felicity's agent for the purpose of Felicity's registration as sole registered proprietor of the land. Alternatively, GC&Co alleged that Felicity derived her interest in the land through the fraud of her agent, Claude. Importantly, GC&Co did not allege, and has not submitted, in this Court or in the courts below, that Felicity was a participant in, or had notice of, Claude's fraud at the time that the Dairy Farm passed to them as joint tenants. 3 Cassegrain v Gerard Cassegrain & Co Pty Ltd (2008) 68 ACSR 132. Hayne Bell Torrens title Legislation implementing the Torrens system of land title is not uniform throughout Australia. Care must always be taken, therefore, to consider and apply the particular statute which is engaged. But a central and informing tenet of the Torrens system is that it is a system of title by registration, not a system of registration of title4. The title which a registered proprietor has "is not historical or derivative. It is the title which registration itself has vested in the proprietor."5 The title of a registered proprietor is not absolutely indefeasible. The RPA, like all versions of the Torrens legislation, provides for circumstances in which a registered title may be defeated or qualified. This case concerns the ambit of the "fraud" exceptions in ss 42(1) and 118(1). Section 42(1) provides that the estate of a registered proprietor is paramount. It provides that, subject to some exceptions which are not relevant to this case: "Notwithstanding the existence in any other person of any estate or interest which but for this Act might be held to be paramount or to have priority, the registered proprietor for the time being of any estate or interest in land recorded in a folio of the Register shall, except in case of fraud, hold the same, subject to such other estates and interests and such entries, if any, as are recorded in that folio, but absolutely free from all other estates and interests that are not so recorded". (emphasis added) Section 118(1) provides that: "Proceedings for the possession or recovery of land do not lie against the registered proprietor of the land, except as follows: proceedings brought by a person deprived of land by fraud against: a person who has been registered as proprietor of the land through fraud, or 4 Breskvar v Wall (1971) 126 CLR 376 at 385 per Barwick CJ; [1971] HCA 70. 5 Breskvar (1971) 126 CLR 376 at 386 per Barwick CJ. Hayne Bell a person deriving (otherwise than as a transferee bona fide for valuable consideration) from or through a person registered as proprietor of the land through fraud". Because GC&Co transferred the land to Claude and Felicity as joint tenants, it will also be necessary to consider s 100(1) of the RPA. It provides that: "Two or more persons who may be registered as joint proprietors of an estate or interest in land under the provisions of this Act, shall be deemed to be entitled to the same as joint tenants." First instance The derivative action was tried by Barrett J. No oral evidence was called. GC&Co tendered a number of documents and alleged that the determination of the oppression proceedings in the Federal Court yielded a number of relevant issue estoppels. It is not necessary to describe in any detail what was said or decided about issue estoppels. The primary judge held6 that the financial impact of Claude's conduct "was recorded within (and suffered by)" GC&Co only at 30 June 1997. The primary judge concluded7 that it was only then that GC&Co acted upon and gave effect to the directors' resolution of September 1996 requiring satisfaction of the purchase price by debiting the loan account. The primary judge found8 that the establishment of the loan account in the books of GC&Co did not represent the recording of genuine indebtedness of GC&Co to Claude in the amount recorded or at all. Accordingly, the primary judge concluded9 that Claude acted not only in breach of fiduciary duty but also fraudulently. As noted earlier in these reasons, these findings are not challenged in this Court. 6 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2011) 6 BFRA 77 at 104 [111]; [2011] NSWSC 1156. (2011) 6 BFRA 77 at 104 [112]. (2011) 6 BFRA 77 at 105 [121]. (2011) 6 BFRA 77 at 107 [129]. Hayne Bell The primary judge found10 that there was no basis in the evidence for finding that "in any aspect of the events concerning the preparation of either [the first or second] transfer [relating to the Dairy Farm], its execution and the processes culminating in its registration, Claude had or exercised any actual or implied authority of Felicity". The primary judge held11 that s 42(1) of the RPA applied with the consequence that Felicity held her interest in the land "free from any interest of GC&Co sourced in Claude's fraudulent breach of fiduciary duty and that the 'fraud' exception to [s 42(1)] does not operate to detract from Felicity's [then] current registered title". The primary judge found12 that Felicity derived her title as sole registered proprietor through Claude, by registration of the second transfer, and was not a transferee of his interest for valuable consideration. But the primary judge held13 that the general rule stated in s 118(1) of the RPA (that proceedings for the possession or recovery of land do not lie against the registered proprietor of the land) was engaged and that the exception to that rule provided by s 118(1)(d) did not apply. That is, the primary judge held that the proceedings were not "brought by a person deprived of land by fraud against: a person who has been registered as proprietor of the land through fraud, or a person deriving (otherwise than as a transferee bona fide for valuable consideration) from or through a person registered as proprietor of the land through fraud". The primary judge concluded14 that s 118(1)(d)(i) did not apply because there was no fraud by Felicity. 10 (2011) 6 BFRA 77 at 112 [158]. 11 (2011) 6 BFRA 77 at 113-114 [167]. 12 (2011) 6 BFRA 77 at 115 [177]. 13 (2011) 6 BFRA 77 at 116 [180]. 14 (2011) 6 BFRA 77 at 115 [176]. Hayne Bell The primary judge's further conclusion that s 118(1)(d)(ii) did not apply depended upon two steps. First, the primary judge held15 that s 118(1)(d)(ii) "deals with a much narrower and more specific subject-matter than the 'except in case of fraud' exception in s 42". His Honour identified16 that narrower subject as "the process by which registration as proprietor was achieved". Second, the primary judge found17 that the process by which the registration of Claude as a registered proprietor was achieved was not attended by fraud. The wrongful drawing of funds from GC&Co (or the provision of illusory consideration by reference to the false loan account) was said18 to be "remote from the process of registration and therefore beside the point". The primary judge dismissed the proceedings brought against Felicity Cassegrain. The primary judge rejected time-based defences advanced by Claude Cassegrain and ordered him to pay an amount of equitable compensation to be fixed after inquiry by an Associate Judge. The inquiry directed by the primary judge was19 an inquiry about the sums drawn from the false loan account (including the sum of $1 million recorded as being applied to payment of the purchase price for the Dairy Farm) and the amount of interest to be allowed in respect of those drawings. The Court of Appeal GC&Co and Claude Cassegrain each appealed to the Court of Appeal against the primary judge's orders. Claude Cassegrain's appeal failed20, and his application for special leave to appeal to this Court was refused21. 15 (2011) 6 BFRA 77 at 116 [178]. 16 (2011) 6 BFRA 77 at 116 [178]. 17 (2011) 6 BFRA 77 at 116 [179]. 18 (2011) 6 BFRA 77 at 116 [179]. 19 Gerard Cassegrain & Co Pty Ltd v Cassegrain [2011] NSWSC 1594 at [17]. 20 Cassegrain v Gerard Cassegrain & Co Pty Ltd (2013) 305 ALR 648. 21 [2014] HCATrans 138. Hayne Bell By majority (Beazley P and Macfarlan JA, Basten JA dissenting) the Court of Appeal allowed22 GC&Co's appeal against the primary judge's orders dismissing its claims against Felicity for recovery of the Dairy Farm. The Court of Appeal declared that Felicity holds the Dairy Farm on trust for GC&Co absolutely and ordered her to execute a transfer of the land to GC&Co. By special leave, Felicity appeals to this Court against the orders of the Court of Appeal. Although the majority the Court of Appeal, Beazley P and Macfarlan JA, concluded that Felicity should transfer the whole of her registered interest in the Dairy Farm to GC&Co, their reasons for that conclusion differed. The third member of the Court, Basten JA, would have declared that Felicity holds a half interest in the Dairy Farm on trust for GC&Co and would have ordered that she execute a transfer of a one-half interest in the land to GC&Co. The differences in reasoning concerned three matters: agency, joint tenancy and registration through fraud. Was Claude Cassegrain Felicity's "agent" in some relevant sense? What follows from the registration of Claude and Felicity as joint tenants? For the purposes of s 118 of the RPA, did Felicity derive her title (in whole or in part) "from or through a person registered as proprietor of the land through fraud"23? Rather than set out a summary of the separate reasons of each member of the Court of Appeal, it is convenient to deal with the issues by reference to the three matters identified. Agency Much attention was given in argument, both in this Court and in the Court of Appeal, to whether Claude Cassegrain was Felicity's "agent". The framing of argument in this way can be traced to the decision of the Privy Council in Assets Company Ltd v Mere Roihi and the well-known statement24 of Lord Lindley that: "the fraud which must be proved in order to invalidate the title of a registered purchaser for value ... must be brought home to the person whose registered title is impeached or to his agents. Fraud by persons 22 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612. 23 s 118(1)(d)(ii). 24 [1905] AC 176 at 210. See also Butler v Fairclough (1917) 23 CLR 78 at 97 per Isaacs J; [1917] HCA 9. Hayne Bell from whom he claims does not affect him unless knowledge of it is brought home to him or his agents." (emphasis added) Thus much of the argument was framed in terms of whether fraud was "brought home" to Felicity because Claude was fraudulent and was her "agent". In the present case, Beazley P found25 that there was sufficient evidence to infer that "Claude was Felicity's agent for the purposes of directing Mr McCarron [the solicitor] to register the first transfer". And her Honour held26 that the consequence of that conclusion was that "the title that Felicity took as registered proprietor jointly with Claude was defeasible as a result of the fraud of her agent". Likewise, her Honour found27 that "the probabilities are that Claude acted as [Felicity's] agent in respect of the second transfer" and that her title as sole registered proprietor was affected by his fraud. Macfarlan JA agreed28 with Beazley P that Claude acted as Felicity's agent with respect to the first transfer. But Macfarlan JA rested29 his conclusion that Felicity's subsequently acquired interest as sole registered proprietor was defeasible on the footing that, having been registered as a joint tenant through fraud, she "did not shed her (imputed) fraudulent knowledge and character by taking a transfer from her co-tenant in whose fraud she was deemed to have participated". By contrast, Basten JA held30 that it should not be inferred that Claude acted as Felicity's agent for the purposes of the transaction which led to their registration as joint tenants. But his Honour held31 that Claude obtained his title as joint tenant through fraud and that, because Felicity was not a transferee of 25 (2013) 305 ALR 612 at 622 [37]. 26 (2013) 305 ALR 612 at 622 [38]. 27 (2013) 305 ALR 612 at 623 [42]. 28 (2013) 305 ALR 612 at 645 [155]. 29 (2013) 305 ALR 612 at 646 [157]. 30 (2013) 305 ALR 612 at 638 [125]. 31 (2013) 305 ALR 612 at 643 [144]-[147]. Hayne Bell Claude's interest bona fide for valuable consideration, GC&Co was entitled to an order that she transfer a half share in the Dairy Farm to it. It has long been recognised32 that "[n]o word is more commonly and constantly abused than the word 'agent'". Close attention, therefore, must be given to what is meant when it is said that Claude Cassegrain was Felicity's "agent". At least for the most part, the word "agent" appears to have been used in the Court of Appeal as a term explaining how events happened rather than as a term attributing legal responsibility for those events. The relevant question was treated as one of fact. That is, what inference should be drawn about how and why the registration of a transfer to Claude and Felicity as joint tenants came about? Or, can it be inferred that Felicity knew that Claude was arranging for the transfer of the Dairy Farm to them both as joint tenants? And because the question seems to have been treated as one of fact, reference was made to Blatch v Archer33 and the proposition that "all evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted". It is important, however, to keep at the forefront of consideration that GC&Co did not allege, and the courts below did not find, that Felicity knew of Claude's fraudulent conduct. Yet the conclusion that Claude was Felicity's "agent" was treated by the majority in the Court of Appeal as a sufficient basis for concluding that the fraud exception provided by s 42(1) of the RPA applied and that her title as registered proprietor was defeasible. That is, what was seen as a factual inquiry about whether Claude brought about the transfer to Claude and Felicity as joint tenants with her knowledge (but without her knowing of the fraud) was treated as concluding the legal issue presented by s 42(1). But why that step should be taken was not explained. Rather, the word "agent" was used as a statement of conclusion. And, as has been said34 in a closely related context, using a word like "agent" is to begin, not end, the relevant inquiry. 32 Kennedy v De Trafford [1897] AC 180 at 188 per Lord Herschell. See also Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41 at 50 per Dixon J; [1931] HCA 53. 33 (1774) 1 Cowp 63 at 65 [98 ER 969 at 970]. 34 Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161 at 172 [29] per Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ; [2006] HCA 19. See also (Footnote continues on next page) Hayne Bell In Clements v Ellis, Dixon J examined35 the decision in Assets Company in great detail. But what Lord Lindley meant by his reference to "agents" was not explored then or in later decisions of this Court. It may be thought that the reference to "agents" was intended to do no more than refer to those natural persons through whom the corporation, Assets Company Limited, had acted in acquiring the registered title that it did. That understanding of the reference would be consistent with the discussion of the issue in the Court of Appeal of New Zealand in one of the several cases36 which were the subject of the consolidated appeals to the Privy Council, but it is not an understanding that would exhaust the meaning given to the dictum, at least inferentially, in later cases. It may also be thought that the reference reflected a view of "deferred" indefeasibility consistent with Gibbs v Messer37, but that understanding would not sit easily with what was later said in Frazer v Walker38 about Assets Company. Instead, the reference to fraud "brought home to the person whose registered title is impeached or to his agents" should be understood, as it was by Street J in Schultz v Corwill Properties Pty Ltd39, as posing, in the case of an agent, questions about scope of authority and whether the agent's knowledge of the fraud is to be imputed to the principal. In the present case, those questions required consideration of why Claude's knowledge of his fraud should be imputed to Felicity. Concluding that Claude had taken the steps necessary to procure registration of the transfer from the company to Felicity and him as joint tenants showed no more than that Claude Scott v Davis (2000) 204 CLR 333; [2000] HCA 52; Hollis v Vabu Pty Ltd (2001) 207 CLR 21; [2001] HCA 44; New South Wales v Lepore (2003) 212 CLR 511; [2003] HCA 4. 35 (1934) 51 CLR 217 at 245-260; [1934] HCA 18. 36 Mere Roihi v Assets Company (1902) 21 NZLR 691 at 719 per Williams J (dissenting), 750-751 per Edwards J; cf Panapa Waihopi v Assets Company (1902) 22 NZLR 37 at 43 per Stout CJ. 38 [1967] 1 AC 569 at 580. 39 [1969] 2 NSWR 576 at 582-583. See also Latec Investments Ltd v Hotel Terrigal Pty Ltd (in liq) (1965) 113 CLR 265 at 273-274 per Kitto J; [1965] HCA 17. Hayne Bell had performed tasks that were of advantage to Felicity40. It was neither alleged nor found that Claude had acted as Felicity's agent in any other way, whether by negotiating41 the transaction with GC&Co or by representing42 that the price for the land could be met by debiting the loan account. So far as the evidence and argument went, Felicity was no more than the passive recipient of an interest in land which her husband had agreed to buy, but which he wanted (with her acquiescence) put into their joint names. Without more, the conclusion that Claude had taken the steps necessary to procure registration of the transfer from the company to Felicity and him as joint tenants did not show that his fraud was within the scope of any authority she had, or appeared to have, given to him. Without more, it did not show that knowledge of his fraud was to be imputed (in the sense of "brought home") to her. And in this case, there was nothing more identified, whether in argument or in the reasons of the Court of Appeal. Did her registration as joint tenant bridge that gap? Joint tenancy In the Court of Appeal, Beazley P held43 that, even if the title which Felicity had held jointly with Claude was defeasible, it did not follow that the title she took on registration of the transfer of Claude's interest to her was. There was, in her Honour's view44, "no relevant fraud of which Felicity had knowledge such as to impugn her indefeasible title as the sole joint tenant". By contrast, as already noted, Macfarlan JA held45 that "Felicity was infected with Claude's fraud because she and Claude took title from [GC&Co] as joint tenants ... [and] joint tenants are treated by the law as in effect one person only" (emphasis 40 cf Sweeney (2006) 226 CLR 161 at 167 [13] per Gleeson CJ, Gummow, Hayne, 41 cf Australasian Brokerage Ltd v Australian and New Zealand Banking Corporation Ltd (1934) 52 CLR 430 at 450-452 per Dixon, Evatt and McTiernan JJ; [1934] HCA 34. 42 cf Sibley v Grosvenor (1916) 21 CLR 469 at 482-483 per Isaacs J; [1916] HCA 14. 43 (2013) 305 ALR 612 at 626 [60]. 44 (2013) 305 ALR 612 at 626 [61]. 45 (2013) 305 ALR 612 at 645 [156]. Hayne Bell added). Basten JA held46 that it was "preferable in principle to treat the shares of the joint tenants, holding title under the [RPA], prior to any severance, as differentially affected by the fraud of one, to which the other was not party". The conclusion reached by Basten JA is right. As his Honour said47, "[t]he contrary view would impute fraud to a party who was not herself fraudulent". That observation is reason enough to reject the contrary view. But it is important to demonstrate that the contrary view cannot be supported by general assertions that "the law" treats joint tenants as "in effect" one person. That demonstration must begin in the text of the RPA. Section 100 of the RPA provides for registration as co-tenants. Sub-sections (2) and (3) deal with proprietors of a life estate and an estate in remainder, and with tenants in common. Their detail need not be noticed. Section 100(1) provides that two or more persons registered as joint proprietors of an estate or interest in land "shall be deemed to be entitled to the same as joint tenants". What is the effect of the deeming? That question requires reference to some aspects of the general law of real property. In Wright v Gibbons48, Dixon J described joint tenancy as "a form of ownership bearing many traces of the scholasticism of the times in which its principles were developed". And as his Honour's discussion49 of the writers shows, the "pedantic, needlessly subtle"50 thinking of that time was often compressed into maxims: especially "nihil tenet et totum tenet" (he holds nothing and he holds the whole) and "per my et per tout" (for nothing and for everything). But, as Wright v Gibbons demonstrates, those maxims cannot and 46 (2013) 305 ALR 612 at 641 [138]. 47 (2013) 305 ALR 612 at 641 [138]. 48 (1949) 78 CLR 313 at 330; [1949] HCA 3. 49 (1949) 78 CLR 313 at 330, referring to Woodbine's edition of Bracton, De Legibus et Consuetudinibus Angliae (see Thorne trans (1977), vol 4, fo 430 at 336), Coke on Littleton (see (1628) at 186a) and Serjeant Manning's notes to Daniel v Camplin (1845) 7 Man & G 167 at 172, note (c) [135 ER 73 at 75] and Murray v Hall (1849) 7 CB 441 at 455, note (a) [137 ER 175 at 180]. 50 The Oxford English Dictionary, 2nd ed (1989), vol XIV at 630, "scholastic", sense A4. Hayne Bell must not be treated as constituting a complete or wholly accurate description of the legal nature of a joint tenancy. The hinge about which the reasoning of Dixon J turned in Wright v Gibbons was that the maxims (and similar statements by later writers to the effect that joint tenants are "considered by the law as one person for most purposes"51) cannot be taken as the premise for deductive reasoning about the effect of a joint tenancy. As Dixon J pointed out52, by reference to Coke on Littleton, "[f]or purposes of alienation each [joint tenant] is conceived as entitled to dispose of an aliquot share". That is because, as Dixon J also said53: "Logical as may seem the deduction that joint tenants have not interests which in contemplation of law are sufficiently distinct to assure mutually one to another, there are many considerations which show that, to say the least, the consequence cannot be called an unqualified truth. The fact is that the principle upon which the deduction is based must itself be very much qualified." (emphasis added) Only by recognising the necessity to qualify those statements of principle is it possible to account for the cases of forfeiture suffered by, and execution against, one of several joint tenants referred54 to by Dixon J. Once qualifications of the principle that joint tenants are "considered by the law as one person for most purposes"55 are admitted to be necessary, bare statement of the principle cannot stand as a premise for deductive argument. It certainly provides no sufficient premise from which a deduction can be drawn about the operation of relevant provisions of the RPA with respect to "[t]wo or more persons who may be registered as joint proprietors of an estate or interest in land under the provisions of [that] Act". Even under the general law of real property, the deeming which is worked by s 100(1) would not entail that those 51 (1949) 78 CLR 313 at 330, referring to Williams, The Seisin of the Freehold, 52 (1949) 78 CLR 313 at 330. 53 (1949) 78 CLR 313 at 330. 54 (1949) 78 CLR 313 at 330-331. 55 (1949) 78 CLR 313 at 330, referring to Williams, The Seisin of the Freehold, Hayne Bell registered as joint tenants are to be treated for all purposes as though they were the one person. Like so many maxims, great care must be used lest "nihil tenet et totum tenet" or "per my et per tout" be used only as slogans stating an asserted conclusion. But in the present case, particular care must be exercised in applying maxims of the kind described. The issue in this case arises, and can only arise, in the context of a statutory system for title by registration. Questions of indefeasibility of registered title simply do not arise in the general law of real property. And no analogy can usefully be drawn between the issue that must be decided in this case and any issue that can arise in the general law of real property. It is wrong, therefore, to begin the inquiry about the application of the fraud exceptions to ss 42(1) and 118(1) by asking what would follow from the "captivating appearance of symmetry and exactness"56 of the four unities (of interest, title, time and possession) necessary for the creation of a joint tenancy under the general law of real property. An inquiry of that kind, adverted57 to by Macfarlan JA, is directed to the nature of the title which a joint tenant would acquire under the general law. It is also wrong to begin by asking only what consequences can be said to follow from s 100(1) of the RPA and its provision that persons registered as joint proprietors "shall be deemed to be entitled to the [relevant estate or interest] as joint tenants". Instead, the question is how that provision intersects with the provisions of s 42. More particularly, does the deeming effected by s 100(1) require that the fraud of one of the persons registered as joint proprietors denies all those persons the protection otherwise given by s 42(1)? To hold that the deeming effected by s 100(1) denies all persons registered as joint proprietors the protection otherwise given by s 42(1) when one of their number has been guilty of fraud would constitute a significant departure from the accepted principle that actual fraud must be brought home to the person whose title is impeached. Both s 100(1) and s 42(1) take their place in an Act providing for title by registration, not registration of title. Both sections are directed to the consequences of registration and focus upon the position of the registered 56 Sweet, Challis's Law of Real Property, 3rd ed (1911) at 367; cf Megarry and Wade, The Law of Real Property, 8th ed (2012) at 497. 57 (2013) 305 ALR 612 at 645 [156], citing Diemasters Pty Ltd v Meadowcorp Pty Ltd (2001) 52 NSWLR 572 at 579-580 [17]. Hayne Bell proprietor, not title in the abstract. Section 42(1) provides that the registered proprietor "shall, except in case of fraud, hold the [relevant estate or interest]" subject to registered interests but otherwise absolutely free from all other interests except those identified in s 42(1)(a)-(d). Section 100(1) provides that persons registered as joint proprietors "shall be deemed to be entitled to the same as joint tenants". The question here is whether a title acquired by registration is defeasible. No light is shed on that issue by asking what title GC&Co lost as a result of the fraud. The relevant question is whether the title of a registered proprietor is defeasible, not what loss the company suffered as a result of the fraud. Thus, observing that GC&Co was deprived of the whole of its interest in the land by Claude's fraud is right but irrelevant. And no light is shed on the issue by asking what would have happened if Claude had died before he transferred his interest in the land to Felicity. In particular, noting that, if Claude had died before the second transfer, Felicity would have been entitled to registration under s 101 of the RPA as the surviving joint tenant says nothing about whether, before registration of a survivorship application, her title as joint tenant was defeasible on account of Claude's fraud. Felicity's title as joint tenant of the Dairy Farm was not defeasible by showing that Claude had acted fraudulently to deprive GC&Co of its land. His fraud was not brought home to Felicity. Because his fraud was not brought home to her, her title as joint tenant was indefeasible. In light of these conclusions, there is no need to consider GC&Co's notice of contention. The grounds advanced in that notice were premised on Claude being found to have been Felicity's agent. There remains for consideration the operation of s 118. Section 118 of the RPA It will be recalled that the primary judge held that, although Felicity derived her title as sole registered proprietor through Claude, and not as a transferee of his interest for valuable consideration, s 118(1)(d) did not apply because Claude was not registered as proprietor of the land through fraud. It will further be recalled that the primary judge treated s 118(1)(d)(ii) as dealing only Hayne Bell with "the process by which registration as proprietor"58 is achieved, a subject said to be narrower and more specific than the fraud exception to s 42(1). All members of the Court of Appeal rightly rejected59 this interpretation of s 118(1)(d)(ii). Neither s 118 generally nor s 118(1)(d)(ii) in particular should be read as directed only to fraud in the process of registration. Exactly what would fall within fraud "in the process" of registration may be open to debate. But it is not a debate that need be had, because s 118 should be construed in a way which is consonant with the operation of s 42(1). In particular, s 118 must not be read in a way which would preclude action to recover the land in a case where the fraud exception to s 42(1) applies. Hence, the reference in s 118(1)(d)(i) to proceedings brought by a person deprived of land by fraud against a person who has been registered as proprietor of the land through fraud must be read as embracing every kind of fraud which falls within the relevant exception to If actual fraud is brought home to the registered proprietor, s 118(1)(d)(i) is engaged and the general bar to proceedings for the possession or recovery of land against that registered proprietor is lifted. Conversely, but equally importantly, if the fraud exception to s 42(1) does not apply to the person who is registered as proprietor, the general bar to proceedings for the possession or recovery of land against the registered proprietor will apply and the exception provided by s 118(1)(d)(i) will not be engaged. That is, the exception for which s 118(1)(d)(i) provides does not diminish the protection given by s 42(1). It does not enlarge the rights which a person deprived of land by fraud has against the registered proprietor. By contrast, the exception provided by s 118(1)(d)(ii) does enlarge the rights which a person deprived of land by fraud has against a registered proprietor. Unless the registered proprietor is a transferee bona fide for valuable consideration, a person deprived of land by fraud may bring proceedings for the possession or recovery of the land against a person deriving from or through a person registered as proprietor of the land through fraud. But as with s 118(1)(d)(i), the expression "registered as proprietor of the land through fraud" must be read in a manner consonant with s 42(1). Hence, in the present case, Claude, but not Felicity, was registered as proprietor of (an interest in) the land (as joint tenant) through fraud. By the 58 (2011) 6 BFRA 77 at 116 [178]. 59 (2013) 305 ALR 612 at 631-632 [90]-[93], 633 [98] per Beazley P, 642-643 [143]-[145] per Basten JA, 646 [158] per Macfarlan JA. Hayne Bell second transfer, Felicity derived from or through Claude an interest as tenant in common as to half. Felicity derived that interest from or through a person registered as proprietor of (an interest in) the land (as joint tenant) through fraud. Felicity was not a transferee of the interest for valuable consideration. Section 118(1)(d)(ii) is thus engaged. Proceedings brought by GC&Co (as a person deprived of the land by fraud) for the recovery of that interest in the land (as tenant in common as to half) lie against Felicity. Improvements to the land On the hearing of the appeal to this Court, Felicity sought to adduce evidence that the land had been improved in various ways since 1997. She submitted that if GC&Co could recover an interest in the land as tenant in common as to half, the matter should be remitted to the Court of Appeal to determine what orders should be made and, in particular, whether some allowance should be made to her for the improvements. Hitherto, Felicity has made no claim for allowances on account of improvements to the land. No evidence was led at trial about improvements. It is now too late for her to make such a claim. The principles discussed and applied in cases like Suttor v Gundowda Pty Ltd60 and Coulton v Holcombe61 preclude her from doing so. Conclusion and orders Felicity's title as joint tenant was not defeasible on account of Claude's fraud. Claude was not her "agent" in any relevant sense. Nor did it follow from Felicity's registration as joint tenant that her title was defeasible. Section 100(1) does not require that the fraud of one of the persons registered as joint proprietors denies all those persons the protection otherwise given by s 42(1). The fraud must be brought home to the person whose title is impeached. Claude's fraud was not brought home to Felicity. But the interest which Felicity derived from or through Claude (an interest as tenant in common as to half) may be recovered by GC&Co. Felicity was not a bona fide purchaser for value of Claude's interest in the land. 60 (1950) 81 CLR 418; [1950] HCA 35. 61 (1986) 162 CLR 1; [1986] HCA 33. Hayne Bell For these reasons the appeal to this Court should be allowed and there should be orders in the form proposed by Basten JA in the Court of Appeal and sought in this Court by Felicity Cassegrain if her appeal succeeded to the extent these reasons would allow. Orders 2 and 3 of the Court of Appeal of the Supreme Court of New South Wales made on 18 December 2013 should be set aside and, in their place, there should be (a) a declaration that Felicity Cassegrain holds a half interest in the property described in Folio Identifiers 4/792413, 1/798316, 115/754434, 124/754434, 2/720827, 117/754434, 118/754434 and 174/754434 on trust for Gerard Cassegrain & Co Pty Ltd absolutely; and (b) an order that Felicity Cassegrain execute a Real Property Act transfer of a one-half interest in the property referred to in par (a) to Gerard Cassegrain & Co Pty Ltd. Although the appellant has had only limited success in her appeal to this Court, she should have her costs of the appeal. KEANE J. The appellant is the registered proprietor of a farming property in New South Wales ("the Dairy Farm") which was previously owned by the respondent. The appellant's title to the Dairy Farm is the subject of the respondent's claim in these proceedings. The appellant's title was acquired through the fraudulent conduct of her husband, Claude Cassegrain ("Claude"), as a director of the respondent. The issue in these proceedings is whether the appellant's title as registered proprietor is indefeasible. The resolution of this issue depends on the operation of the Real Property Act 1900 (NSW) ("the Real Property Act"). Before turning to the relevant provisions of the Real Property Act, and the differing views of the courts below as to their operation in this case, the facts which gave rise to the issue should be briefly summarised. Factual background On 2 September 1996, Claude and Anne-Marie Cameron, the directors of the respondent at that time, resolved that the respondent should transfer the Dairy Farm to Claude and the appellant as joint tenants for a consideration of $1 million and the performance of some other obligations. The instrument of transfer was executed on 14 September 1996 by the respondent as transferor under its common seal, attested by Claude and Anne-Marie Cameron, and Mr Chris McCarron as solicitor for Claude and the appellant as transferees62. On 27 February 1997, a letter was sent on behalf of the respondent, signed by "Claude Cassegrain Managing Director", requesting Mr McCarron to "register the transfer as exchanged." On the same day, Mr McCarron sent a response to "Mr C Cassegrain c/- Gerard Cassegrain & Co Pty Ltd" informing Claude that the instrument of transfer would be lodged for registration. Registration of the transfer ("the first transfer") was effected on 10 March 1997. Mr McCarron confirmed that this had occurred by a letter dated 14 March 1997 addressed to "Mr C Cassegrain c/- Gerard Cassegrain & Co Pty Ltd". Claude purported to pay for the Dairy Farm by debiting a loan account standing in his favour in the sum of $4.5 million in the books of the respondent. The debiting occurred on 30 June 1997. In fact, as was held below and is no longer in contest, the respondent was not indebted to Claude in terms of the loan account; and Claude's claim to debit the loan account was a false claim which was known by him to be false. 62 There was no allegation that the $1 million consideration was an undervalue, nor was there any allegation of wrongdoing by Anne-Marie Cameron or Mr McCarron. On 24 March 2000, Claude executed an instrument of transfer of his interest in the Dairy Farm to the appellant for a consideration of one dollar. The transferor, and by instrument of Mr McCarron on behalf of the appellant as transferee. This transfer was registered on 18 April 2000 ("the second transfer"). transfer was executed by Claude as The proceedings The respondent commenced proceedings in the Supreme Court of New South Wales against Claude and the appellant. Against Claude, the respondent sought an order that he pay equitable compensation for breach of his fiduciary duty to the respondent. Against the appellant, the respondent sought an order that the appellant transfer the Dairy Farm to it, and, alternatively, a declaration that the appellant held the Dairy Farm on trust for the respondent. In these proceedings, the respondent did not seek to plead or prove that the appellant knew, at the time of the first transfer, that Claude's intention was to cheat the respondent out of its title to the Dairy Farm for nothing. The appellant contended that her title as sole registered proprietor of the Dairy Farm is indefeasible under the Real Property Act. The Real Property Act Section 42 of the Real Property Act provides that the estate or interest of a registered proprietor under the Act is indefeasible, "except in case of fraud": "(1) Notwithstanding the existence in any other person of any estate or interest which but for this Act might be held to be paramount or to have priority, the registered proprietor for the time being of any estate or interest in land recorded in a folio of the Register shall, except in case of fraud, hold the same, subject to such other estates and interests and such entries, if any, as are recorded in that folio, but absolutely free from all other estates and interests that are not so recorded". Section 118 provides for the working out of the operation of the fraud title established by s 42. indefeasibility of registered the exception Section 118(1)(d) provides: "(1) Proceedings for the possession or recovery of land do not lie against the registered proprietor of the land, except as follows: proceedings brought by a person deprived of land by fraud against: a person who has been registered as proprietor of the land through fraud, or a person deriving (otherwise than as a transferee bona fide for valuable consideration) from or through a person registered as proprietor of the land through fraud". By the registration of the first transfer the appellant and Claude were registered as joint proprietors of a fee simple estate in the Dairy Farm. In this regard, it is to be noted that s 100(1) of the Real Property Act provides: "Two or more persons who may be registered as joint proprietors of an estate or interest in land under the provisions of this Act, shall be deemed to be entitled to the same as joint tenants." The decision of the primary judge The primary judge (Barrett J) found that "to the extent that Claude received payments from [the respondent] ... he took moneys of [the respondent] that it was not legally obliged to pay to him"63 in breach of his fiduciary duty to the respondent and dishonestly64. The primary judge concluded that the appellant's title as sole registered proprietor was indefeasible so that the respondent's claim against the appellant "for the possession or recovery of land" was precluded by s 118(1)(d) of the Real Property Act. The primary judge found that there was a lack of evidence to conclude that Claude exercised actual or implied authority on behalf of the appellant in relation to either the first or second transfer of the Dairy Farm65 so as to sheet home his fraud to her. "In the particular statutory context, 'fraud' is 'to be construed as meaning something more than mere disregard of rights of which the 63 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2011) 6 BFRA 77 at 106 [121]. 64 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2011) 6 BFRA 77 at 107 [129]. 65 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2011) 6 BFRA 77 at 112 [158]. 66 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2011) 6 BFRA 77 at 114 [168]. person sought to be affected had notice, and as importing something in the nature of personal dishonestly [sic] or moral turpitude'67 ... [The] relevant fraud or dishonesty is 'dishonesty on the part of the registered proprietor in securing his registration as proprietor.'[68]" In addition, the primary judge held that, while the appellant may have been accountable in equity to the respondent, ss 42 and 118(1)(d) of the Real Property Act operated so that her title as sole registered proprietor of the Dairy Farm was indefeasible69. In relation to the second transfer, in particular, his Honour concluded70: "Claude, the person 'from or through' whom [the appellant] derived her interest, was not 'registered as proprietor of the land through fraud'. These are the operative words of the section. Their focus is exclusively on the process by which registration as proprietor was achieved and the question whether that process was achieved by fraud. … Section 118(1)(d)(ii) thus deals with a much narrower and more specific subject-matter than the 'except in case of fraud' exception in s 42." The decision of the Court of Appeal The Court of Appeal, by majority (Beazley P and Macfarlan JA, Basten JA in dissent), allowed the respondent's appeal, declared that the appellant held the Dairy Farm on trust for the respondent absolutely, and ordered that the appellant transfer the Dairy Farm to the respondent. Beazley P proceeded to consider the respondent's argument that Claude was acting as the appellant's agent in procuring both the first and second transfers71. Her Honour said that: "[t]he letter of 27 February 1997 ... should be viewed in the context ... of Claude's fraud in having the dairy farm transferred … to him and [the 67 Stuart v Kingston (1923) 32 CLR 309 at 329; [1923] HCA 17. 68 Bahr v Nicolay [No 2] (1988) 164 CLR 604 at 614; [1988] HCA 16. 69 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2011) 6 BFRA 77 at 113-114 70 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2011) 6 BFRA 77 at 115-116 71 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 618 [19]. appellant] ... Claude must have written the letter on behalf of the transferees."72 Her Honour was satisfied that, in the absence of evidence to the contrary, this was sufficient evidence to draw an inference that the appellant impliedly authorised Claude's actions in procuring the first transfer73. Her Honour concluded that Claude and the appellant74 obtained their registered title to an estate as joint tenants as a result of fraud; that title was, therefore, defeasible75. In relation to the second transfer, her Honour again drew "the inference, on the available evidence, that the probabilities are that Claude acted as her agent in respect of the second transfer"76. Beazley P disagreed with the primary judge's view that the operation of s 118(1)(d)(ii) was confined to the process whereby registration is achieved77, concluding that, on the ordinary meaning of the words, the appellant was a person deriving her interest as sole registered proprietor "from or through" Claude78. Because Claude was a person whose title was registered through fraud, "[the appellant's] title is vulnerable at the suit of [the respondent]."79 Macfarlan JA agreed with Beazley P that "the inference should be drawn that Claude acted as [the appellant's] agent for the purposes of their acquisition of the property and its registration in their joint names"80. 72 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 621 [30]. 73 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 622 [37]. 74 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 623 [42]. 75 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 622 [38]. 76 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 623 [42]. 77 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 633 [98]. 78 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 631 [89]. 79 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 632 [94]. 80 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 645 [155]. In addition, Macfarlan JA held that the appellant "was infected with Claude's fraud because she and Claude took title from the [respondent] as joint "As [the appellant] was infected with Claude's fraud both because he acted as her agent and because they were registered as joint tenants, she was a person who, within the terms of s 118(1)(d)(i), was registered as a joint tenant 'through [her own] fraud'. She did not shed her (imputed) fraudulent knowledge and character by taking a transfer from her co-tenant in whose fraud she was deemed to have participated. That transfer again led to her registration 'through [her own] fraud': it was only possible because of their existing fraudulent registration." Basten JA held that the respondent's case that the appellant was complicit in Claude's fraud was deficient in that the respondent failed to establish that the appellant knew of Claude's fraudulent design83. As to the argument that the joint tenancy which resulted from the first transfer meant that Claude's fraud "infected" the appellant's title, as Macfarlan JA held, Basten JA said84: "[I]t is preferable in principle to treat the shares of the joint tenants, holding title under the Real Property Act, prior to any severance, as differentially affected by the fraud of one, to which the other was not party. The contrary view would impute fraud to a party who was not herself fraudulent. On that approach, [the appellant] should be treated as having a half interest in the dairy farm, from March 1997, which was indefeasible, because unaffected by [Claude's] fraud." Basten JA went on to hold that, pursuant to s 118(1)(d)(ii) of the Real Property Act, the respondent was entitled to succeed in recovering Claude's half share in the Dairy Farm, the subject of the second transfer. In this regard, Basten JA said85: 81 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 645 [156]. 82 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 646 [157]. 83 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 637-638 84 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 641 [138]. 85 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 643 "The finding that [the appellant] was not a transferee bona fide for valuable consideration was not challenged. … In the result, the [respondent] is entitled to obtain an order that [the appellant] transfer a half share in the dairy farm (being the share obtained from [Claude]) to the [respondent]." The parties' submissions In this Court, the appellant submitted that s 118(1)(d)(i) of the Real Property Act was not applicable unless Claude was found to be the appellant's agent in committing the fraud which led to the registration of the first transfer. The appellant submitted that the majority in the Court of Appeal were wrong to conclude that Claude could be regarded as the appellant's agent so as to taint her with his fraud in respect of either transfer. In relation to s 118(1)(d)(ii), the appellant accepted that her title was derived from or through Claude, but supported the view of the primary judge that, because the registration of the first transfer took place on 10 March 1997, and the debiting of the loan account did not occur until 30 June 1997, Claude was not registered as proprietor through fraud86 for the purposes of s 118(1)(d)(ii) of the Real Property Act. The respondent contended that there was sufficient evidence to infer that Claude procured the first transfer as the appellant's agent. In this regard, the respondent relied on the reasoning87 of Beazley P that: Claude had written Mr McCarron to register the first transfer; the letter of 27 February 1997 instructing in writing that letter, Claude had assumed authority to act on the appellant's behalf; and given that the appellant failed to adduce evidence that she opposed Claude's assumption of authority, it could be inferred that Claude had acted as her agent in procuring the first transfer. Beazley P's conclusion was said to be justified on the basis of the principle in Blatch v Archer88 that "all evidence is to be weighed according to the proof 86 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2011) 6 BFRA 77 at 116 [179]. 87 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 620-622 88 (1774) 1 Cowp 63 at 65 [98 ER 969 at 970]. which it was in the power of one side to have produced, and in the power of the other to have contradicted." Pursuant to a notice of contention, the respondent sought to sustain the decision of the majority of the Court of Appeal on the additional basis favoured by Macfarlan JA, that is, that the appellant's registered title to the Dairy Farm as sole proprietor was defeasible by reason of Claude's fraud in procuring the transfer of the Dairy Farm to himself and the appellant as joint tenants. The respondent relied in this regard upon the decision of the Supreme Court of New South Wales in Diemasters Pty Ltd v Meadowcorp Pty Ltd89, where Windeyer J held that where one of two joint purchasers of land engages in fraud in procuring the title of the joint registered proprietors, the title of the joint registered proprietors is defeasible by the defrauded party. This contention should be accepted and the decision of the Court of Appeal affirmed on the additional ground stated by Macfarlan JA. Agency The decision of the Court of Appeal cannot be sustained on the basis that Claude's fraud could be sheeted home to the appellant as a matter of agency. Fraud, for the purpose of ss 42 and 118(1)(d) of the Real Property Act, is the depriving of a person of an interest90 by actual dishonesty. In Assets Co Ltd v Mere Roihi91, it was said: "the fraud which must be proved in order to invalidate the title of a registered purchaser ... must be brought home to the person whose registered title is impeached or to his agents. Fraud by persons from whom he claims does not affect him unless knowledge of it is brought home to him or his agents ... A person who presents for registration a document which is forged or has been fraudulently or improperly obtained is not guilty of fraud if he honestly believes it to be a genuine document which can be properly acted upon." 89 (2001) 52 NSWLR 572 at 579-580 [17]. 90 Attorney-General (NSW) v Peters (1924) 34 CLR 146 at 149-150, 151-152; [1924] CLR 31. 91 [1905] AC 176 at 210. As Street J said in Schultz v Corwill Properties Pty Ltd92: "It is not enough simply to have a principal, a man who is acting as his agent, and knowledge in that man of the presence of a fraud. There must be the additional circumstance that the agent's knowledge of the fraud is to be imputed to his principal. This approach is necessary in order to give full recognition to (a) the requirement that there must be a real, as distinct from a hypothetical or constructive, involvement by the person whose title is impeached, in the fraud, and (b) the extension allowed by the Privy Council that the exception of fraud under s 42 can be made out if 'knowledge of it is brought home to him or his agents'." The respondent did not seek to plead or prove a case that the appellant was knowingly engaged in Claude's scheme to deprive the respondent of its land for nothing. That being so, the appellant could not be said to be knowingly involved in Claude's dishonest conduct; accordingly, she could not be held to have been a party to his fraud. In these circumstances, the principle in Blatch v Archer93 cannot avail the respondent. Joint tenancy It is not in dispute that Claude acted fraudulently in relation to both the first and second transfers, as he deliberately sought to cheat the respondent out of its title to the Dairy Farm. Nor is there any question that the respondent was deprived of its title to the land through the fraud perpetrated by the first transfer. If Claude had procured the registration of the transfer from the respondent to himself as sole registered proprietor of the land, and then transferred the land to the appellant for one dollar, there could be no doubt that the respondent would be entitled to recover the land from the appellant under s 118(1)(d)(ii) of the Real Property Act. The question for decision is whether the respondent is to be denied recovery of the entirety or one-half of its land because Claude adopted the expedient of a fraudulent transfer to himself and the appellant before effecting the second transfer94. 92 [1969] 2 NSWR 576 at 583. 93 (1774) 1 Cowp 63 at 65 [98 ER 969 at 970]. 94 It may be said that if Claude had simply transferred the land directly to the appellant and that transfer had been registered, without any involvement on her part in his fraud, the appellant's title would clearly have been indefeasible. On this basis, it might be said that there is nothing particularly odd about regarding the appellant's title as indefeasible merely because it was the consequence of two transfers. In practical terms, however, by the first transfer Claude obtained a legal (Footnote continues on next page) The issue may be analysed in this way. By virtue of s 100(1) of the Real Property Act, the estate acquired by the appellant and Claude as a result of the registration of the first transfer was but one estate held by them jointly. That title was acquired through the fraud of the registered proprietor, the title of Claude and the appellant being one and indistinguishable. On that basis, s 118(1)(d)(i) was engaged in favour of the respondent. For the purposes of s 118(1)(d)(i), the appellant and Claude were jointly registered proprietors of the single title created by the registration of the first transfer. After the registration of the second transfer, the appellant's title to the then severed half share thereby acquired by her from Claude was defeasible under s 118(1)(d)(ii). That is because the appellant was a person who derived that title from Claude, and he was a person who had been registered as a proprietor of his (then severed) aliquot share through fraud. According to the authoritative exposition of ss 42 and 118(1)(d) of the Real Property Act (and their Torrens title analogues), an indefeasible title is acquired by a registered proprietor by the fact of registration; and the fraud exception to indefeasibility operates only where the registration of a proprietor is obtained by the fraud of the registered proprietor or its agents95. Thus, in Registrar of Titles (WA) v Franzon96, Mason J, with whom Barwick CJ and Jacobs J agreed, said of the Western Australian analogue of the Real Property Act: "[T]he section identifies the person against whom action may be brought as the person 'who acquired title to the estate or interest through such fraud'. These words strongly suggest that the section is directed to fraud perpetrated by or on behalf of the person who secures registration." (emphasis of Mason J) This exposition was not directed to a case of acquisition by joint tenants. Accordingly, it does not foreclose the analysis summarised above. There was only one registered title in the land which was obtained by the registration of the first transfer, and that was acquired by Claude and the appellant, "as joint proprietors"97. Because there was no separate title acquired estate for himself as well as the appellant, which could not have been achieved by procuring a transfer to the appellant as sole proprietor. 95 Assets Co Ltd v Mere Roihi [1905] AC 176 at 210; Breskvar v Wall (1971) 126 CLR 376 at 384; [1971] HCA 70; Registrar of Titles (WA) v Franzon (1975) 132 CLR 611 at 618; [1975] HCA 41. 96 (1975) 132 CLR 611 at 618. 97 Real Property Act, s 100(1). by the appellant upon registration of the first transfer, the issue is not so much, as Basten JA put it, whether it is appropriate to "impute fraud to a party who was not herself fraudulent"98, but whether the respondent was deprived of land by the registration of a title to the land obtained through the fraud of the registered proprietor. this regard, s 118(1)(d)(ii) renders defeasible title of a non-fraudulent registered proprietor who, not being a transferee bona fide for valuable consideration, derives his or her title from or through a person who had been registered as proprietor of the land through fraud. That being so, it is difficult to ascribe to s 118(1)(d)(i) an intention to render indefeasible a jointly held registered title acquired through the fraud of one of two joint registered proprietors in circumstances where the other joint proprietor was not a transferee bona fide for valuable consideration. the It was the registration of the appellant and Claude as joint proprietors which, in a system of title by registration99, effected that deprivation in this case. The appellant and Claude, as joint proprietors, acquired a single estate in the Dairy Farm. The respondent was deprived of its title by the registration of their title to that estate or interest. That title was acquired by fraud "sheeted home" to the appellant, not because the appellant claimed her title through Claude as her agent, but by virtue of the nature of the joint tenancy of the single estate to which they were entitled. In Wright v Gibbons100, Dixon J reflected upon the basal proposition that "in contemplation of law joint tenants are jointly seised for the whole estate they take in land and no one of them has a distinct or separate title, interest or possession." Dixon J surveyed the authorities which support that proposition, his survey culminating in the statement of Mr Joshua Williams in his lectures on The Seisin of the Freehold101 that joint tenants were considered by the law as one person for most purposes. Dixon J went on to observe that, for some purposes, the law has departed from the rigorous application of that basic proposition, instancing the ability of 98 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 641 [138]. 99 Frazer v Walker [1967] 1 AC 569 at 580. 100 (1949) 78 CLR 313 at 329; [1949] HCA 3. one joint tenant to alienate an aliquot share of the title formerly held in common, and then said102: "If one joint tenant suffered a forfeiture it was not the whole estate but only his aliquot share that was forfeited. If one joint tenant proved to be an alien the Crown, on office found, took only his share. Execution on a judgment for debt against one joint tenant bound his aliquot share and continued to do so in the hands of the survivor if the execution debtor afterwards died. ... Each joint tenant could declare uses and they could declare different uses of their respective shares". The examples given by Dixon J are cases of alienation, whether voluntary or not, of the severable interest of a joint tenant. These examples do not deny the truth of the proposition that, at least so far as the acquisition of a joint title is concerned, "in contemplation of law joint tenants are jointly seised for the whole estate they take … and no one of them has a distinct or separate title". The proposition that the title obtained by the appellant and Claude upon the registration of the first transfer was, "for the purpose of tenure"103, the single estate held by them in common may be, as Dixon J described it, one of the "many traces of the scholasticism of the times in which [the] principles of [joint tenancy (as a form of ownership)] were developed."104 Nevertheless, modern authority confirms that the historical understanding of the nature of the title acquired by joint tenants remains an accurate statement of the legal status thereby acquired as against the outside world. Thus, in Hammersmith and Fulham London Borough Council v Monk105, Lord Browne-Wilkinson said that a transfer of land to two or more joint tenants "operates so as to make them, vis à vis the outside world, one single owner." And, in Peldan v Anderson106, Gummow ACJ, Kirby, Hayne, Callinan and Crennan JJ were not dismissing a mere historical curiosity of no current legal relevance when they referred to joint tenants as "together composing one single owner, each being seised per my et per tout". Importantly, s 100 of the Real Property Act confirms that, for the purposes of that Act, the joint proprietorship of a registered title is in the nature of a joint tenancy, at least until it is severed. Upon the registration of the first transfer, in 102 Wright v Gibbons (1949) 78 CLR 313 at 330-331. 103 Wright v Gibbons (1949) 78 CLR 313 at 331. 104 Wright v Gibbons (1949) 78 CLR 313 at 330. 105 [1992] 1 AC 478 at 492. 106 (2006) 227 CLR 471 at 480 [19]; [2006] HCA 48. conformity with s 100, the appellant acquired title to one estate jointly with Claude. The registered proprietors of that title acquired it through fraud; and that is no less true because the appellant herself did not actually participate in That a joint tenancy is readily severable, as indeed s 97 of the Real Property Act107 contemplates, does not lead to a different conclusion: it is not suggested by any party that the joint tenancy of Claude and the appellant was severed at any time before the registration of the second transfer. To recognise the ease of severance and an effective alienation of an aliquot share by one joint tenant to another is not to deny that until the alienation occurs joint tenants are seised of their joint estate or interest as one single owner of that estate or interest. If the second transfer had not occurred, and the respondent had brought proceedings against both Claude and the appellant under s 118(1)(d)(i), no stretch of language would have been involved in accepting that they were persons who, viewed together, were "registered as proprietor of the land through fraud". No decided case precludes the application of that description to them; indeed, given that s 118(1)(d) "restricts, in the interests of indefeasibility of title, rights which would exist otherwise at law or in equity"108, the judicial gloss on the fraud exception should not be extended to defeat the respondent's claim. As to the second transfer, and s 118(1)(d)(ii) of the Real Property Act, the judges of the Court of Appeal were right to hold that there is no good reason to construe the phrase "registered ... through fraud" as being confined narrowly to the administrative process of registration. The words "through fraud" naturally mean "accomplished by means of fraud"; they are wide enough to capture Claude's fraudulent conduct in effecting the transfer of the Dairy Farm with the intention of taking the land without any payment to the respondent. It is wrong to read s 118(1)(d)(ii) as narrower in scope than the fraud exception to indefeasibility in s 42(1) of the Act, and as concerned only with the "administrative process of registration". That is so for two reasons: first, it is to narrow, in an uncertain way not warranted by the text, the scope of a provision intended to permit the vindication of rights which would otherwise exist at law or 107 Section 97(1) of the Real Property Act provides: "Registration of a transfer by a joint tenant of the joint tenant's interest in the land that is the subject of a joint tenancy to himself or herself severs the joint tenancy." 108 Bahr v Nicolay [No 2] (1988) 164 CLR 604 at 615. See also Stuart v Kingston (1923) 32 CLR 309 at 345. in equity109; and secondly, it is to fail to appreciate the role of s 118(1)(d) as working out the practical operation of the fraud exception to the general rule stated in s 42(1) of the Act110. As was rightly said by Basten JA in the Court of Appeal111: "[T]hat s 118(1) deals with a narrower subject matter than the exception in s 42 ... would be surprising, because it would appear to leave no statutory mechanism for the defrauded landowner to recover the land, despite the exception in s 42(1), leaving the transferee's title defeasible." Conclusion and orders The registration of neither the first nor the second transfer created an indefeasible title in the appellant. The appellant and Claude were registered as proprietors of the land through fraud. And the appellant derived Claude's half share upon the second transfer from Claude, a person who had been registered as proprietor through his fraud. Accordingly, the respondent is entitled to recover its land from the appellant. The appeal should be dismissed with costs. 109 Bahr v Nicolay [No 2] (1988) 164 CLR 604 at 615. 110 Registrar of Titles (WA) v Franzon (1975) 132 CLR 611 at 618. 111 Gerard Cassegrain & Co Pty Ltd v Cassegrain (2013) 305 ALR 612 at 643 [144].

HIGH COURT OF AUSTRALIA LIDO RUSSO & ANOR APPELLANTS AND RESPONDENT Russo v Aiello [2003] HCA 53 30 September 2003 ORDER 1. Appeal dismissed with costs. 2. Order 1 suspended for 28 days from the date of this Order and for such further time as a Justice of this Court may order before the expiry of that 28 day period and on an application made within 14 days of this Order. 3. Liberty to apply to file, on an application made in accordance with Order 2, written submissions as to whether any other order should be made by this Court respecting the position of the second appellant. On appeal from the Supreme Court of New South Wales Representation: G B Hall QC with A R Lakeman for the appellants (instructed by Turner Whelan) D J Russell SC with G F Butler for the respondent (instructed by Mr Bhim Ramrakha) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Russo v Aiello Limitation of actions – Action in respect of motor vehicle accident where claimant lodged claim outside statutory time limit – Whether claimant had a full and satisfactory explanation for delay in making claim – Whether material difference between having and providing an explanation – Whether reasonable person in position of claimant would have been justified in experiencing the same delay – Onus of establishing full and satisfactory explanation – Relevance of prejudice to defendant caused by stay – Motor Accidents Act 1988 (NSW), ss 40(2), 43(2), 43A(2), 43A(6), 43A(7). Appeal – Where primary judge of District Court erred in law and fact in making discretionary judgment – Whether errors vitiated decision of primary judge – Whether Court of Appeal erred in its disposition of appeal – Whether relief futile. Motor Accidents Act 1988 (NSW), ss 40(2), 43(2), 43A(2), 43A(6), 43A(7). GLEESON CJ. The relevant facts, and statutory provisions, are set out in the reasons for judgment of Gummow and Hayne JJ. Part 5 of the Motor Accidents Act 1988 (NSW), ("the Act"), in the form relevant to this appeal, deals with claims (defined, in s 40, to include claims for damages in respect of personal injury arising from fault by the owner or driver of a motor vehicle), and court proceedings to enforce claims. The objects of the Part are stated in s 40A. They include ensuring that claims are quickly brought to the attention of insurers. Division 2 of Pt 5, dealing with claims and other matters preliminary to court proceedings, is of present relevance. Section 43(2) states that a claim of the kind made by the appellants must be made within six months after the date of the motor accident to which the claim relates. Sub-section (1) explains the object of that requirement. Section 43(A), which also commences with a statement of its objects, qualifies the requirement in s 43(2) by providing that a claim may be made more than six months after the relevant date "if the claimant provides a full and satisfactory explanation for the delay in making the claim". The explanation is to be provided "in the first instance" to the insurer of the potential defendant. The concept of a "full and satisfactory explanation" is, to some extent, explained by s 40(2), which deals with the two elements as follows. A full explanation is said to be a full account of the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation. The word "full" takes its meaning from the context. It refers to the conduct bearing upon the delay, and the state of mind of the claimant. The sub-section goes on to provide that an explanation is not a satisfactory explanation unless a reasonable person in the position of the claimant would have been justified in experiencing the same delay. Part 5 is replete with legislative declarations of its objects. This is not an exercise in apologetics. Rather, it gives practical content to terms such as "reasonable", "justification" and "satisfactory". What would constitute justifiable delay on the part of a reasonable person in making a claim is to be considered in the light of the legislative purposes explained in the Act. That matter is taken further by a specific provision (in s 43A(3)) that evidence as to delay in the onset of symptoms of physical injury may form part of an explanation. The concept of "a reasonable person in the position of the claimant" could give rise to difficulties that do not exist in the present case. The first appellant consulted a solicitor some 10 days after the motor vehicle accident in which he was injured. He was informed of the time limits imposed by the Act, and was handed a claim form. There is no basis in the evidence for concluding that he did not receive prompt and competent legal advice. We are not concerned with the possible significance of incompetent or inadequate legal advice, or lack of awareness of the time limits on making a claim. Leaving to one side problems of the kind just mentioned, what would justify a reasonable person in the position of a claimant "experiencing" a delay? It is impossible to give an exhaustive list of possible justifications. Delay in onset of symptoms is one example; and it is an example of some relevance to this case. It is to be noted that what the Act requires is justification for delay; not demonstration that the delay caused no harm. That does not mean that the Act is unconcerned with the presence or absence of prejudice to insurers resulting from delay. The objects referred to in s 40A include enabling early investigation and assessment of claims, and early information to enable ready prediction of claim frequency and provision for calculation of further premiums. However, while the problems that insurers might experience as a result of delays in making claims form part of the general legislative concern, the focus of the statutory concept of a satisfactory explanation is upon justifying delay, rather than excusing it. It is one thing to say that conduct is justified by reference to the way in which a reasonable person in the position of a claimant could have been expected to behave. It is another thing to say that delay ought to be excused because it caused no identifiable harm to an insurer. It is the former, not the latter, question that is raised for consideration. Furthermore, the justification called for is in the context of a legislative scheme which aims "to ensure that claims are quickly brought to the attention of insurers". The various statements as to the objects of the legislation show that the legislature made its own evaluation of the importance of prompt notification of claims, and constructed a statutory scheme around that evaluation. It is not for a court to re-assess that policy on a case by case basis. The mandatory language of s 43(2)(a) (a claim must be made within six months) is qualified by s 43A(2) (a claim may be made later if a full and satisfactory explanation is provided). However, the mandatory language is taken up again in s 43A(7), which provides that a court "must dismiss proceedings commenced in respect of a late claim if the court is satisfied that the claimant does not have a full and satisfactory explanation for the delay in making the claim". No discretion is conferred. If a certain state of satisfaction exists, the proceedings must be dismissed. There was some argument about the significance of the word "have" in s 43A(7). It will be necessary to return below to the facts of the present case. As a matter of statutory construction, however, it is impossible to conclude that the legislation attaches significance to a supposed difference between having an explanation and providing one. In that respect, it is necessary to put the issue into perspective. What is in question in a case such as the present is an explanation for delay on the part of a claimant in making a claim; that is to say, an explanation for the conduct of the claimant. Leaving aside cases of incapacity, or other exceptional circumstances, ordinarily it will be the claimant who is in the best position to give what s 40(2) describes as "a full account of the conduct, including the actions, knowledge and belief" of the claimant in relation to the reasons for the delay. Often, perhaps usually, the claimant will be the only person who is in a position to give such an account. Section 43A(2) relaxes the strict time limit imposed by s 43(2), but only on condition that the claimant provides a full and satisfactory explanation of the delay. That explanation is to be "provided in the first instance" to the prospective defendant's insurer. The reference to the explanation being thus provided in the first instance is linked to s 43A(7), which refers to the duty of a court to dismiss proceedings commenced in respect of a late claim "if the court is satisfied that the claimant does not have a full and satisfactory explanation for the delay in making the claim". The existence of such a state of satisfaction is a condition precedent to the operation of the statutory duty to dismiss the proceedings. It follows that a defendant seeking an order dismissing proceedings will be entitled to such an order if, and only if, after evidence and argument, the court is persuaded to such a state of satisfaction. In that respect, the defendant carries the onus. But when regard is had to the nature of the question about which satisfaction is required, which is a question concerning the reasons for the conduct of the claimant, and is a matter about which the claimant will ordinarily be the person best able, and will often be the only person able, to give information, then a court would be likely to infer that such information as is made available to it by a claimant (which may involve information in addition to that provided to the insurer) is all that a claimant can say by way of explanation of his or her conduct. Lord Mansfield said that "all evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted".1 This is a fundamental precept of the adversarial system of justice, and is treated as axiomatic in the day to day operations of courts. When a court comes to consider the issue raised by s 43A(7), by hypothesis, the claimant will already have provided information to the insurer pursuant to a statutory requirement to provide a full explanation of the delay. Sometimes that may be the whole of the information before the court. Sometimes a claimant may seek to add to it. Either way, since it is the claimant's explanation of his or her own conduct that is the subject of judicial evaluation, and since the claimant is at risk of having the proceedings dismissed, common sense will ordinarily justify the inference that a claimant does not possess undisclosed information that might assist his or her case, especially where, as here, the claimant is professionally represented. Quite apart from such practical forensic considerations, the possibility that a claimant is in possession of, but has failed to provide to the court, information by way of explanation of his or her delay, is not one with which the legislation is 1 Blatch v Archer (1774) 1 Cowp 63 at 65 [98 ER 969 at 970]. concerned. The question raised by s 43A(7) is not whether the claimant possesses information; it is whether the claimant has an explanation. An explanation, of its nature, is something that is communicated to a third party. This is emphasised by the requirement for the court to consider whether the explanation is full, which is said (in s 40(2)) to mean a full account of the claimant's conduct. Section 43A(7) is concerned with the account of a claimant's conduct that is before the court, not with information which is undisclosed. If the explanation referred to in s 43A(7) were to be regarded as information possessed, but not communicated, by the claimant, rather than an account of conduct imparted to a third party, then the requirement that the explanation be "full" makes no sense. There may be cases in which a primary judge, or an appellate court, is tempted to speculate that, perhaps because of deficiencies in a claimant's legal representation, or because of some accident or mistake, there is information helpful to a claimant that has not been put before a court when considering whether to dismiss proceedings. I say "speculate" because it is usually impossible for a judge to know what is in counsel's brief. Such speculation is not a reason for departing from the ordinary process of fact-finding, including drawing of inferences, or for failing to apply the provisions of the statute. In the case of an appeal, whether the possibility in contemplation is relevant, and ought to be pursued further, depends upon the grounds of appeal. The account of the claimant's conduct that was before the primary judge in the present case is set out, and analysed, in the reasons for judgment of Gummow and Hayne JJ. The primary judge said: "The next question then to be addressed is whether I am satisfied that the plaintiff does not have a full and satisfactory explanation for the delay in making [the] claim. That must be assessed on the information now before the Court. The onus is on the plaintiff to provide that explanation." As all the members of the Court of Appeal held, the last sentence in that passage is erroneous. For that reason, all three members of the Court of Appeal reconsidered the s 43A(7) issue for themselves. In doing so, Young CJ in Eq repeated what he described as the "key passage" in the judge's reasoning: "There is no attempt to identify when it was that the plaintiff realised that his disabilities had not improved, thus leading to the decision to seek further legal advice, and there is no attempt to identify when that decision was made. It can readily be seen that different consequences might flow in terms of whether the explanation is satisfactory if the realisation that disabilities had not improved had taken place in December 1997, or close to that time, as opposed to having taken place, for instance, in September 1998, or close to that time. There is just a dearth of detail over that period of approximately eleven months, which, in my view, prevents the conclusion being made that the explanation is full in the sense required under the Act." The judge concluded that there was such a lack of detail for the period in question that the explanation "cannot be regarded as full". Young CJ in Eq, with whom Meagher JA agreed, recorded that the case was not argued in the Court of Appeal on the basis that there was, or might have been, additional information favourable to the appellants that was not proffered to the primary judge. Hodgson JA recorded a concession by counsel for the appellants that there was no suggestion that the appellants were denied natural justice. It is possible to infer from his Honour's reasons for his dissenting judgment that he was troubled by that concession; but there is no ground of appeal before this Court that would call it into question. Young CJ in Eq, reconsidering the s 43A(7) issue, concluded "that there was not a full and satisfactory reason given for the delay in this case". That conclusion followed an earlier reference to the precise terms of s 43A(7), and to the practical significance, having regard to the way the case was conducted, of the absence of information about aspects of the conduct of the appellants. It is to be understood in that context, and amounted to a conclusion that his Honour was satisfied that the appellants did not have a full and satisfactory explanation for the delay in making the claim. The decision of the Court of Appeal has not been shown to be in error. The appeal should be dismissed with costs. I agree with the additional orders proposed by Gummow and Hayne JJ. McHugh 20 McHUGH J. The issue in this appeal is whether the Court of Appeal of New South Wales erred in finding2 that the District Court of that State had not erred in holding3 that the respondent had established that the appellants did not have "a full and satisfactory explanation for the delay" in making a claim governed by the Motor Accidents Act 1988 (NSW). In my opinion, the Court of Appeal did err in so holding. But on the evidence, and despite errors made by the District Court, the appellants did not have "a full and satisfactory explanation for the delay". Accordingly, the appeal to this Court must be dismissed. Mr Lido Russo, the first appellant, alleged that he sustained injury on 11 January 1997 while a passenger in a car driven by the respondent, Mr John Dominic Aiello. He alleged that the negligent driving of Mr Aiello caused the car to leave the road and collide with a rock face. A Motor Accident Personal Injury Claim Form completed by Mr Russo was received by Mr Aiello's insurer on 26 March 1999, more than two years after Mr Russo sustained his injuries. Almost a year later, Mr Russo filed a Statement of Claim in the District Court of New South Wales claiming damages against Mr Aiello. The second appellant was also a plaintiff in the action. Its claim is a derivative one that is dependent on Mr Russo being successful in his action. For the purposes of this appeal, it is sufficient to refer only to the position of Mr Russo. If his appeal fails, so does the appeal of the second appellant. Section 43(2) of the Motor Accidents Act requires any claim arising out of a motor accident to be made within six months of the "relevant date for the claim." For the purposes of the Act, the injured person makes a claim by giving notice of it to the person against whom the claim is to be made and to that person's insurer if the insurer is a third party insurer. However, s 43A(2) declares that a claim "may be made more than 6 months after the relevant date for the claim under section 43 (in this section called a late claim) if the claimant provides a full and satisfactory explanation for the delay in making the claim." The explanation has to be provided to the third party insurer if there is one, or to the Nominal Defendant. Section 40(2) provides that "a full and satisfactory explanation ... for delay" requires: "a full account of the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation. The explanation is not a satisfactory explanation unless a reasonable person in the position of the claimant ... would have been justified in experiencing the same delay." 2 Russo v Aiello (2001) 34 MVR 234. 3 Russo v Aiello unreported, District Court of New South Wales, 15 August 2000. McHugh If a plaintiff commences court proceedings in respect of a late claim, s 43A(6)(c) enables the insurer, or the person against whom the claim is made, to "apply to have the proceedings dismissed on ... the ground of delay". However, the application must be made within two months of the Statement of Claim being served on the defendant and received by the insurer, and the insurer must not have lost the right to challenge the claim on the ground of delay. Section 43A(6) provides that the defendant or that person's insurer or the Nominal Defendant, who is served with a late claim, loses the right to challenge the claim on the ground of delay when either of two conditions occur. First, if, within two months of receiving a late claim for which no explanation for the delay is provided, the insurer does not reject the claim or ask the claimant to provide a full and satisfactory explanation for the delay. Second, if, within two months after receiving an explanation for the delay in the making of a late claim, the insurer does not reject the explanation. Once the insurer brings a valid application for dismissal, s 43A(7) relevantly and emphatically declares: "A court must dismiss proceedings commenced in respect of a late claim if the court is satisfied that the claimant does not have a full and satisfactory explanation for the delay in making the claim ..." After receiving the late claim, Mr Aiello applied under s 43A(7) for an order dismissing the action. The primary judge found that the insurer in the present case rejected the explanation for the delay that Mr Russo had provided. The Court of Appeal upheld the primary judge's finding on this point. Mr Russo did not challenge that finding in this Court. Nor did Mr Russo challenge the fact that Mr Aiello brought the application to dismiss the proceedings within two months of the Statement of Claim being served on him and received by the insurer. Because that was so, the remaining issue for the primary judge was whether Mr Aiello had proved that Mr Russo "does not have a full and satisfactory explanation for the delay in making the claim"4. The terms of s 43A(7) indicate that Mr Aiello had the onus of establishing this issue. But once he did, the primary judge was required to dismiss the action. He had no discretion to refuse to do so. I also agree with Gleeson CJ "that what the Act requires is justification for delay; not demonstration that the delay caused no harm."5 Prejudice or lack of prejudice to the applicant for a s 43A(7) order is irrelevant in determining whether the applicant is entitled to the order. 4 Section 43A(7). 5 Reasons of Gleeson CJ at [7]. McHugh The primary judge held that Mr Russo's explanation for delay during the period 6 December 1997 to 6 October 1998 could not be regarded as "full". He upheld the application for dismissal and dismissed the action. In making his decision, however, the learned primary judge made two errors. First, his Honour said that the "onus is on the plaintiff to provide that explanation." That is, his Honour erroneously put the onus on Mr Russo to show that he had a full and satisfactory explanation for the delay. Second, the primary judge said that, apart from a statutory declaration of Mr Russo, "there is no further information given in relation to the plaintiff's work activities, if any, from 6 December 1997 to 6 October 1998". The primary judge erred in making this statement because there was other information before him concerning the relevant period. It included the particulars in Mr Russo's Statement of Claim, an affidavit that he had sworn and medical reports dated December 1998 and May 1999 concerning his condition. It is a question of fact whether the applicant for a s 43A(7) order has proved that a plaintiff does not have a full and satisfactory explanation for the delay in making a late claim. But although it is a factual and not a legal issue, the criterion of a "full and satisfactory explanation" for delay does not involve any perception by the senses of some matter, event or entity in the external world. It does not depend on sight, hearing, feeling or touch. A "full and satisfactory explanation" for delay is an intellectual construct involving a value judgment, a judgment on which reasonable persons may have widely differing views. It is therefore properly described as a discretionary judgment. Because that is so, the Court of Appeal could set aside the primary judge's decision on the issue only on the basis of the well-known principles concerning an appeal against a discretionary judgment. Despite this limitation on the right of appeal against the primary judge's decision, the case was one for appellate intervention. The two errors that the learned primary judge made vitiated his decision6. He made an error of law in respect of onus and he failed to take into account evidence that he should have taken into account. The Court of Appeal should have set aside his Honour's judgment and either exercised the discretion itself or remitted the matter to the District Court for further hearing. However, the majority judges in the Court of Appeal, although recognising that the trial judge had erred, neither exercised the discretion themselves nor remitted the case to the District Court. Instead, their Honours classified the errors as "errors of process", held that they did not constitute appellable error and that the primary judge's conclusion "was one which he was entitled to reach on the material before him". 6 See, for example, Australian Coal and Shale Employees' Federation v The Commonwealth (1953) 94 CLR 621 at 627 per Kitto J. McHugh For the reasons that I have given, the Court of Appeal erred in so holding. Its decision must be set aside. It is true that the majority considered what they would do if there had been appellable error on the part of the trial judge. Their Honours said that, if they had had to determine the matter, they would have reached the same conclusion as the primary judge. However, a statement as to how a judge would exercise a discretion, that the judge holds that he or she does not have, has no weight in determining whether an appeal from a discretionary judgment should be upheld7. This Court must make the order that the Court of Appeal should have made. That is to say, it should either exercise the discretion itself or remit the matter to the Court of Appeal to decide whether it should exercise the discretion or remit the matter to the District Court. Because this Court must make the order that the Court of Appeal should have made, it is also open to this Court to order that the appeal to the Court of Appeal be allowed and that the matter be remitted to the District Court. Unlike Hodgson JA, who dissented in the Court of Appeal, I do not think that that Court should have refrained from exercising the discretion because of the course taken before the primary judge. Hodgson JA said that the additional information indicated "that the appellants could, if required, have provided more material". His Honour said that, because the insurer had not specified in what respect the explanation was deficient and had not cross-examined Mr Russo on his affidavit, "it would be quite wrong to draw the inference" that the appellants did not have a full and satisfactory explanation for the delay. However, Mr Aiello had no obligation to specify in what respect the material relied on by Mr Russo was deficient. An applicant for a s 43A(7) order has the onus of proving a negative – that the plaintiff does not have a full and satisfactory explanation for the delay. But upon tendering what, if any, explanation the plaintiff has already given, the applicant makes a prima facie case for an order if that explanation is not "full and satisfactory". At the hearing, the plaintiff may supplement any explanation already given. But if and when the plaintiff does so, the explanation then given establishes that that is the only explanation that the plaintiff has. That is because the plaintiff's conduct in answering the applicant's case is an admission that the plaintiff has no other evidence that could help his or her case8. Ordinarily, the proper order for this Court to make would be an order remitting the matter to the Court of Appeal to exercise the discretion or to remit 7 Wade v Burns (1966) 115 CLR 537 at 555 per Barwick CJ. Jones v Dunkel (1959) 101 CLR 298 at 321 per Windeyer J. McHugh the case to the court of first instance. However on the evidence, the only conclusion reasonably open is that Mr Russo did not have a full and satisfactory explanation. Because that is so, it would be pointless and an occasion for unnecessary expense to the parties to remit the case to the Court of Appeal. This Court should exercise the discretion and hold that Mr Russo did not have a full and satisfactory explanation for the action. Accordingly, the primary judge correctly dismissed the appellants' action in the District Court. in commencing the delay Order The appeal must be dismissed. GUMMOW AND HAYNE JJ. This appeal is taken from a decision of the New South Wales Court of Appeal9. It concerns the principles to be applied by a court in attaining satisfaction, on an application for dismissal of proceedings, that a claimant does not have a full and satisfactory explanation for a delay in making a claim to which the Motor Accidents Act 1988 (NSW) ("the Act") applied. The first appellant, Mr Russo, was born in 1975. The second appellant, Zucchini Pty Ltd ("Zucchini"), is a company which carried on business under the name "Red Zucchini Bar". By their Statement of Claim filed in the District Court of New South Wales on 6 January 2000, the appellants pleaded a cause of action in negligence against the respondent. They alleged that on 11 January 1997 the respondent, whilst driving at Terrey Hills in New South Wales, had negligently failed to negotiate a sharp left-hand bend in the road, resulting in the vehicle losing traction and colliding with a rock face on the road's eastern kerb. Mr Russo, then 21 years of age and an employee and co-owner of Zucchini, was a passenger in the vehicle. He sought damages for injuries, lost earnings and medical expenses; Zucchini sought damages for loss of the services of Mr Russo and consequential loss and damage. As will appear, the arguments on this appeal invite attention to the position of Mr Russo and it is convenient hereafter on occasion to refer to him as "the claimant". It will be necessary later in these reasons to refer in greater detail to the provisions of the Act, but it is sufficient here to note that s 43(2) thereof obliged the claimant to make the claim against the respondent within six months after the motor accident. Moreover, that limitation is imposed upon those claiming damages "in respect of the death of or injury to a person" (s 40(1)). It is not immediately apparent that Zucchini made a claim of that nature. However, at all stages, the fate of its claim has been treated as following that made by the claimant. The point may now be put to one side, but it will be necessary to return to it. The claimant completed a document styled a "Motor Accident Personal Injury Claim Form" and dated 23 March 1999. It was received by the solicitors for the respondent three days later. This was some 26 months after the motor accident. The claimant sought to explain the delay in a Statutory Declaration subscribed and declared on 25 March 1999. The relevant facts alleged in the 9 Russo v Aiello (2001) 34 MVR 234. Statutory Declaration were later summarised by Young CJ in Eq in the Court of Appeal in the following terms: [The claimant] saw a solicitor at Parramatta with his father on 21 January 1997; (ii) On that occasion he [believed] he was ... handed a claim form [and was advised of the applicable time limits]; (iii) He did not complete the form as he considered his disabilities would improve; (iv) He went to Italy in July, 1997 [to stay with his family, hoping the rest would improve his condition]; (v) During 1997, he received a letter from the Parramatta solicitor, but there was no follow up on the claim form; In November, 1997, his father received a further claim form; (vii) He returned to Australia in December, 1997; (viii) His problems appeared to have improved with the time in Italy; (ix) Later he realised his condition had not improved; In October 1998, he consulted new solicitors; (xi) At the time he consulted new solicitors, he had in his possession a partly completed claim form, but he cannot remember how that came about. (xii) He received specialist medical advice in January and February (xiii) He completed the claim form with his new solicitors on 23 March The temporal gap between (vii) and (x) is significant for this case. The respondent, by Notice of Motion, sought to have the Statement of Claim dismissed under s 43A(7) of the Act, on the footing that the claimant did not have a full and satisfactory explanation for his delay in making the claim. The District Court Upon the hearing of the respondent's motion before the District Court (Dodd DCJ), it became clear that it was only in respect of the period from 6 December 1997 (when the claimant returned from Italy to Australia) to 6 October 1998 (when the claimant consulted new solicitors) that the respondent alleged there had not been a "full" explanation. Dodd DCJ dismissed the claimant's proceedings under s 43A(7) of the Act, finding that the claimant's explanation could not be regarded as "full" in respect of that period. The Court of Appeal By majority, the Court of Appeal (Meagher JA and Young CJ in Eq, Hodgson JA dissenting) granted leave to appeal but dismissed an appeal by the claimant. Young CJ in Eq, with whom Meagher JA concurred, observed that although, for reasons to which it will be necessary to return, there may have been "errors of process" in the District Court, there was no error in the conclusion of the primary judge. The Chief Judge in Equity said that, even if he had been of the view that the decision of the primary judge ought to have been set aside for error, he would still have reached the conclusion "that there was not a full and satisfactory reason given for the delay in this case". Hodgson JA would have granted leave to appeal, allowed the appeal and dismissed the respondent's motion on the basis that he was not satisfied "that the appellants do not have a full and satisfactory explanation". It will be necessary later in these reasons further to consider his Honour's reasoning. The scheme of the Act Section 5 of the Act repeals the Transport Accidents Compensation Act 1987 (NSW). Section 6 provides that the law relating to a claim for damages for death or bodily injury arising out of a transport accident occurring on or after 1 July 1987 shall be as if that statute had not been passed and the common law and the enacted law (except that statute) is to have effect accordingly. Hence the recitation, in s 2A(1), of the objects of the Act as follows: to repeal the Transport Accidents Compensation Act 1987 and thereby to abolish the scheme for compensating victims of transport accidents (TransCover) established under that Act, and to re-instate a common law based scheme under which damages can only be awarded after a finding of negligence, and by the scheme under this Act: (iii) to reduce the cost of the former common law based scheme by limiting benefits for non-economic loss in the case of relatively minor injuries, and to introduce a stricter procedure for the making and assessment of claims for damages, and to preserve the benefits payable to persons with more severe injuries involving on-going disability, and to give full weight to the need to identify fraudulent claims, deter their lodgment and prosecute those responsible for them, and to encourage recovery from injury and early and effective rehabilitation, where appropriate, as a key feature of the scheme, and to encourage the speedy, efficient and effective provision of benefits balanced by the need to investigate claims properly and the need to encourage an early return to employment." Part 5 (ss 40-66A) of the Act is headed "Claims and court proceedings to enforce claims". The Part is concerned with claims for damages, as already mentioned, in respect of death or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle (s 40(1))10. Section 40A emphasises that the objects of Pt 5 are: to ensure that claims are quickly brought to the attention of insurers: to enable early investigation and assessment of claims, and to enable the early identification of the nature and severity of the injuries sustained in the motor accident and of the likely treatment and rehabilitation needs of the injured person, and 10 Section 41 provides that Pt 5 of the Act does not apply to motor accidents occurring after the commencement of the Motor Accidents Compensation Act 1999 (NSW) on 5 October 1999. (iii) so that insurers can readily predict claim frequency and hence make appropriate provision for the calculation of premiums, and to enable accident victims to receive prompt treatment and rehabilitation and prompt payment of lost earnings where liability is clear, and to promote negotiation between the parties and, by means of alternate dispute resolution, to ensure that the resolution of disputed claims by the courts is kept to a minimum, and to underscore the need to deter and prevent the making of fraudulent and exaggerated claims." Division 2 (ss 42-47A) of Pt 5 is headed "Claims and other matters preliminary to court proceedings". Section 42 obliges a person who is entitled to make a claim to ensure that a written report of the motor accident is made to the police within 28 days of the date of the accident. Section 43(2) stipulates that a claim must be made within six months after the "relevant date for the claim", being the date of the motor accident or death. A claim is made by giving notice of the claim to the person against whom the claim is made and, if that person's insurer is a third-party insurer, to the insurer (s 43(4)). Sub-section (1) of s 43 provides that the object of that section is: "to promote the early making of claims to enable the insurer: to commence investigations while evidence relating to a claim is available, and to identify injuries and facilitate the access of claimants to appropriate injury management and rehabilitation services and thus to expedite the claimant's recovery, and to allow the insurer to more accurately predict claim frequency and hence formulate premiums." Section 43A permits, in certain circumstances, the making of claims beyond the six month limit provided for in s 43(2). Section 43A(2) states: "A claim may be made more than 6 months after the relevant date for the claim under section 43 (in this section called a late claim) if the claimant provides a full and satisfactory explanation for the delay in making the claim. The explanation is to be provided in the first instance to the third-party insurer concerned (if there is one) or to the Nominal Defendant." The content of the expression "a full and satisfactory explanation for the delay" is supplied by s 40(2) in the following terms: "a full account of the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation. The explanation is not a satisfactory explanation unless a reasonable person in the position of the claimant ... would have been justified in experiencing the same delay." The only statutory indication of the kind of delay which a reasonable person in the position of the claimant would have been justified in experiencing appears in s 43A(3). This provides that evidence as to any delay "in the onset of symptoms" relating to the injury suffered as a result of the motor accident may be given in any explanation provided under s 43A(2). Sub-section (4) of s 43A qualifies the exception from the six month time limit provided for in sub-s (2). It provides that a claim may not be made more than 12 months after the motor accident unless, in addition to the provision of a full and satisfactory explanation, a further condition is satisfied. This is that the total damages of all kinds likely to be awarded to the claimant if the claim succeeds are not less than 10 per cent of the maximum amount that may be awarded for non-economic loss under s 79 or s 79A of the Act. The claim made by the claimant on its face satisfies this condition. Sub-section (6) of s 43A applies if a late claim is made against the Nominal Defendant or a person insured by a third-party insurer. It specifies two circumstances in which the insurer (defined so as to include the Nominal Defendant) and the person against whom the claim is made, "lose the right to challenge the claim on the ground of delay". These are (i) if, within two months after receiving a late claim for which no explanation for delay is provided, the insurer does not reject the claim or ask the claimant to provide a full and satisfactory explanation for the delay (par (a)); and (ii) if, within two months after receiving an explanation for delay in the making of a late claim, the insurer does not reject the explanation (par (b)). The loss of "the right to challenge" is carried into effect, and a temporal limitation is placed on the exercise of the right, by par (c) of sub-s (6). This provides: "If court proceedings are commenced in respect of a late claim, an insurer (or the person against whom the claim is made) may apply to have the proceedings dismissed on: the ground of delay, or in the case of a late claim that is made more than 12 months after the relevant date for the claim under section 43, the ground of the amount of damages, or both, only within 2 months after the statement of claim is served on the defendant and received by the insurer. The insurer (or the person against whom the claim is made) may only apply to have the proceedings dismissed on the ground of delay if the insurer (or the person) has not lost the right to challenge the claim on the ground of delay." The primary judge found that the insurer here "rejected" the explanation provided by the claimant in the sense spoken of in par (b) of sub-s (6) by letter dated 3 May 1999. This finding was upheld in the Court of Appeal and was not challenged in this Court. Further, the respondent brought its Notice of Motion within two months after the Statement of Claim had been served on the respondent and received by the insurer. It follows that the respondent was not disabled by sub-s (6) from applying to have the proceedings dismissed. Sub-section (7) of s 43A is of central importance to this appeal. It imposes on the court a duty to dismiss the proceedings, conditioned upon the attainment by the court of satisfaction that a certain state of affairs exists. The sub-section states: "A court must dismiss proceedings commenced in respect of a late claim if the court is satisfied that the claimant does not have a full and satisfactory explanation for the delay in making the claim and, alternatively or in addition in the case of a late claim that is made more than 12 months after the relevant date for the claim under section 43, that the total damages of all kinds likely to be awarded to the claimant if the claim succeeds are less than 10 per cent of the maximum amount that may be awarded for non-economic loss under section 79 or 79A as at the date of the relevant motor accident." (emphasis added) The scheme of s 43A therefore is that, in the first instance, a claimant must provide to the insurer a full and satisfactory explanation for the delay. If dissatisfied with the explanation, it is then for the insurer, or the person against whom the claim is made, provided they have not lost the right to challenge the claim for delay under sub-s (6), to apply to the court to have the proceedings dismissed. The court must dismiss the proceedings if the moving party satisfies it that, relevantly, the claimant does not have a full and satisfactory explanation for the delay. The use in sub-s (7) of the phraseology "does not have a full and satisfactory explanation for the delay" indicates that, in determining whether it has attained the requisite satisfaction, the court is not restricted to a consideration of the explanation which the claimant was obliged by sub-s (2) to provide "in the first instance" to the insurer. The question the statute presents is whether the court is satisfied, on all the material before it, that the claimant does not "have" a full and satisfactory explanation for delay. The proceedings must be dismissed if the court is satisfied that either or both (i) it does not have before it a full account of the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation, or (ii) that a reasonable person in the position of the claimant would not have been justified in experiencing the same delay. Evidence tending to establish the "full account" referred to in (i) above is peculiarly likely to be within the control of the claimant. It follows that, ordinarily, a conclusion that the court does not have before it a "full account" of the claimant's conduct at the relevant times may more readily be reached where the claimant has failed to provide, by the close of submissions, such an account. However, the onus remains on the applicant to satisfy the court that the claimant does not have a full and satisfactory explanation for the delay. The discharge of this onus ordinarily would involve specifying the respects in which the claimant's account is said not to be "full" in the relevant sense, and identifying why it is that a reasonable person in the claimant's position would not have been justified in experiencing the same delay. However, the applicant under par (c) of s 43A(6) and s 43A(7) is not required to speculate upon or to seek to challenge an unarticulated, or secret, reason for delay; a reason for delay which the claimant does not articulate cannot be described as an "explanation" for delay. It follows that the requisite satisfaction that a claimant does not have a full and satisfactory explanation for delay may readily be attained where a claimant fails to disclose any explanation at all. So much is consistent with the objects of s 43A, which are identified in sub-s (1) thereof as being: to ensure that the issue of the lateness of a claim is dealt with as soon as possible after receipt of the claim, and to ensure that any delay caused to the consideration of the substantive claim by the lateness issue is kept to a minimum, and to ensure that the lateness issue is either resolved or made a mutually apparent substantive issue at an early date". Contrary to a submission put by the appellants in this Court, the imperative language of s 43A(7) leaves no room for a consideration of any "prejudice" that may be caused to the parties by a decision to dismiss or to decline to dismiss the proceedings. The provision imposes a duty to dismiss upon the attainment of the relevant satisfaction; it does not confer a discretion to extend time of the type commonly found in statutes of limitation, the exercise of which may require evaluation of any prejudice to the defendant11. Full and satisfactory explanation? The primary judge concluded that the claimant's explanation could not be regarded as "full" in respect of the period 6 December 1997 to 6 October 1998. Nonetheless, s 43A(7) uses the composite expression "full and satisfactory explanation", and the question the primary judge posed for himself, and that addressed by the Court of Appeal, was directed to whether the explanation was "full and satisfactory". In this litigation the respondent's challenge to the adequacy of the explanation has been confined to the period 6 December 1997 to 6 October 1998. The District Court therefore was obliged to dismiss the proceedings if the respondent satisfied it that either or both (i) it did not have before it a full account of the conduct, including the actions, knowledge and belief of the claimant throughout that period, or (ii) a reasonable person in the position of the claimant would not have been justified in experiencing the same delay in that period. In his reasons, the primary judge said that "[t]he onus is on the plaintiff to provide that explanation". As each member of the Court of Appeal indicated, if this was intended to mean that the claimant bore the onus of proving that the explanation he had given was full and satisfactory, it was an error. As the moving party on the motion, the respondent ought to have made submissions first before the primary judge, yet it appears that the oral submissions for the claimant on the question whether the claimant had a full and satisfactory explanation were given before those for the respondent. One consequence was that the alleged gap in the claimant's explanation apparently was raised for the first time in the respondent's submissions in the District Court. The claimant did not then apply to re-open to lead more evidence in rebuttal, but was permitted to address the Court in reply. It follows that, notwithstanding the deficiencies in the procedure adopted, the respondent specified the respects in which the explanation was said to be other than full and satisfactory, by challenging the detail provided in respect of the period 6 December 1997 to 6 October 1998, and the claimant was afforded the opportunity to respond. 11 cf Salido v Nominal Defendant (1993) 32 NSWLR 524 at 531, 538; Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541. The primary judge correctly observed that whether he was satisfied that the claimant did not have a full and satisfactory explanation for the delay "must be assessed on the information now before the Court". His Honour then referred to the paragraphs of the claimant's Statutory Declaration respecting the period 6 December 1997 to 6 October 1998. These stated: I returned to Australia on 6 December 1997 and my problems from the accident appeared to have improved as I had spent six months relaxing and under no stress with no responsibility. I returned to Australia in relation to a job offer, believing that I would be able to rejoin the work force, although I was still having some problems associated with the accident. Shortly before I returned to Australia, my father had received a letter addressed to me dated 7 November 1997, enclosing a further personal injury claim form, and he made arrangements with Dr Row, my general practitioner, the medical certificate. This was arranged whilst I was still out of the country. to complete 12. After some time, I realised that my disabilities had not improved, in fact, became worse, and my life was being affected to a greater extent than I had initially believed, and I decided to seek further legal advice. 13. On about 6 October 1998, I attended the offices of [the new solicitors] ...". The primary judge continued that, apart from par 10 of this Statutory Declaration, "there is no further information given in relation to the plaintiff's work activities, if any, from 6 December 1997 to 6 October 1998". Hodgson JA correctly observed that this was inaccurate. There was other material before the primary judge, to which Hodgson JA referred, which provided further details respecting the actions, knowledge and belief of the claimant from 6 December 1997 to 6 October 1998. The primary judge erred in not having regard to that material, which included the particulars in the claimant's Statement of Claim12, certain medical reports and an affidavit dated 14 April 2000 sworn by the claimant. 12 This was received into evidence without objection. That additional material indicated the following. From December 1997 to July 1998, the claimant established a business by the name of Ceruti's Bistro where he worked as manager until July 1998. From July 1998 to December 1998, he set up with his brother an establishment called Lido Bar, where he worked as manager two nights per week until December 1998. The claimant then was employed as a manager at Ceruti's Bistro from December 1998 to March 1999. The claimant complained to medical practitioners of headaches, recurrent episodes of dizziness, and shoulder and back pain throughout this period, and appeared to experience some psycho-sociological disruption during his time at Lido Bar. It may be inferred that, from the period 6 December 1997 to 6 October 1998, the claimant's symptoms, though recurrent, were not so severe as to prevent him from working. This suggests that, throughout this period, the claimant continued to hold the belief, expressed in his Statutory Declaration, that his injuries would improve and were not sufficiently serious to make a claim. The claimant asserted a gradual realisation that his condition was deteriorating, culminating in his decision to seek new legal advice in October 1998. The claimant acknowledged in his Statutory Declaration that he was advised in January 1997 of the time limits that applied to claims under the Act and that his father had received a further Personal Injury Claim Form shortly before the claimant's return to Australia. The inference is open that, throughout the period 6 December 1997 to 6 October 1998, the claimant knew of the relevant time limit. The District Court therefore had before it an account of the conduct, including the actions, knowledge and belief of the claimant from 6 December 1997 to 6 October 1998. However, the conclusion was open that this was not a "full" account within the meaning of s 40(2) of the Act. Even when regard is had to the additional material not referred to by the primary judge, it was still correct to observe, as his Honour did, that: "[t]here is no attempt to identify when it was that the plaintiff realised that his disabilities had not improved, thus leading to the decision to seek further legal advice, and there is no attempt to identify when that decision was made." Moreover, even if it were accepted that the account was relevantly "full", the conclusion would be open that the claimant's explanation in respect of the period 6 December 1997 to 6 October 1998 was not "satisfactory" because a reasonable person in the position of the claimant would not have been justified in persisting in such a delay. Whether a "reasonable person" would have been so "justified" requires an evaluation by reference to a hypothetical objective standard and in light of the objects of the Act. Part 5 of the Act evinces a legislative intention "to promote prompt settlement of claims and to encourage forensic diligence"13. The statutory scheme, emphasised repeatedly in the provisions to which reference has earlier been made, is to encourage the early investigation, assessment and resolution of claims. The statute in terms indicates that this scheme is intended to advance the interests of claimants in rehabilitation, prompt treatment and prompt payment of lost earnings and the interests of insurers in more accurately predicting claim frequency and formulating premiums. Those objects are sought to be achieved by the imposition of time limits and obligations to act expeditiously on both claimants and insurers14. The claimant here had been informed of the time limit with which he was required to comply. The relevant delay extended for some ten months, at a time when the initial six month limit itself had elapsed six months prior to the commencement of the period of delay now in issue. The delay was not referable to any delay in the onset of symptoms, the consideration to which the Act refers in s 43A(3). It is not to be assumed that this is the only consideration which may be relevant to whether a reasonable person in the position of the claimant would have been justified in experiencing the same delay. Nonetheless, in the relevant period, the claimant experienced recurrent symptoms, the severity of which became gradually more apparent to him, and yet he failed to make a claim which he knew should have been made on or before 11 July 1997. The conclusion was open that a reasonable person in the position of the claimant would not have been justified in a delay of this degree. The reasons of Hodgson JA In an earlier paragraph of his dissenting judgment, Hodgson JA had identified the correct approach to be adopted: "[I]n deciding whether a defendant has discharged its onus of proving that a claimant does not have a full and satisfactory explanation for the delay, a Court would have regard to the explanation provided to the insurer, and to the circumstance that normally only the claimant is able to give evidence of the claimant's explanation for delay; and if the Court considered that the explanation provided to the insurer was not full and satisfactory, and if there was no relevant additional material before the Court, the inference 13 Salido v Nominal Defendant (1993) 32 NSWLR 524 at 530. 14 For example, s 45(1) provides that "[i]t is the duty of an insurer to endeavour to resolve a claim, by settlement or otherwise, as expeditiously as possible." that the claimant did not have a full and satisfactory explanation would readily be drawn." However, in the third last paragraph of his reasons, Hodgson JA said: "The material relevant to the particular delay ultimately relied on by the respondent, namely that between 6 December 1997 and 6 October 1998, showed plainly that the appellants could, if required, have provided more material in relation to that period. Notwithstanding that the onus was squarely on the respondent to prove the absence of an explanation, the respondent chose not to specify any respect in which the explanation was said to be deficient, and chose not to cross-examine the first appellant on his affidavit. Whether or not the material actually provided to the Court does itself amount to a full and satisfactory explanation, in my opinion it would be quite wrong to draw the inference against the appellants in those circumstances that they do not have a full and satisfactory explanation." (emphasis added) His Honour then emphasised that the question was whether the Court was satisfied that the claimant did not "have" a full and satisfactory explanation, rather than whether such an explanation had been "given". If this passage was intended to indicate that the respondent was required to challenge a reason for delay which was not disclosed by the material before the Court by the close of submissions then, for the reasons earlier given, it should be rejected. The better view may be that his Honour was not intending to state any general propositions as to the construction of the statute. Rather, his remarks may reflect the view he took of the particular circumstances of the litigation in the District Court and of the consequences of the misapprehension as to onus of proof which appeared to affect the course of proceedings before that Court. Conclusion The majority in the Court of Appeal has not been shown to have erred in upholding the conclusion of the primary judge that the claimant did not have a full and satisfactory explanation for the delay in making the claim. As indicated above, it was the whole of the Statement of Claim which was dismissed by the District Court and that order was upheld by the Court of Appeal. The appeal to this Court should be dismissed with costs. However, that order should be suspended for 28 days from the date of that order and for such further time as a Justice of this Court may order before the expiry of that 28 day period and on application made within 14 days of that order. The parties should be granted liberty to file on such application made as above written submissions as to whether any other order should be made by this Court respecting the position of Zucchini. Kirby KIRBY J. This appeal challenges a judgment that followed a divided decision of the New South Wales Court of Appeal15. Special leave to appeal to this Court was not granted because of the inherent importance of the facts of the case. Rather, it was provided because the matter was said to raise a question of principle concerning the meaning of the Motor Accidents Act 1988 (NSW) ("the Act") as it applied to lateness in the making of claims and the commencement of proceedings in respect of claims governed by the Act. At the special leave hearing, this Court was given statistics that suggested that, in the year 1999/2000, 21 per cent of all claims under the Act, running into many hundreds, were made outside the times which the Act fixed16. The motor accidents claim form in the present case was completed during that period. The number of out of time claims recorded in the statistics reportedly fell in later years, dropping to 18 per cent in 2000/2001 and to 8 per cent in 2001/200217. These falls suggest that the requirements of the Act as to time eventually became known to injured claimants and their legal representatives. Any superimposition of new time limitations upon a legal system that for centuries18 had recognised a right, in most cases, to bring a damages claim in tort years after the cause of action arose, was bound to cause mistakes, and apparent injustices, at least at the beginning of the operation of the new legislation. This is what makes this appeal important not only to the present parties but for other cases affected by the interpretation of the provisions of the Act that this Court adopts. Many cases wait in the wings for the outcome of this appeal. The facts and provisions of the Act Belated motor accident claim: The facts are set out in the reasons of Gummow and Hayne JJ, as are the relevant provisions of the Act19. Mr Lido Russo ("the claimant") was injured in a motor car accident on 11 January 1997. He consulted a solicitor on 21 January 1997. The solicitor was described by him as "young and inexperienced" and not such as to give him confidence in the strength of his claim. However, the claimant was provided with a claim form and advised of the time limit imposed by the Act. In July 1997 he went overseas without having lodged the claim form. 15 Russo v Aiello (2001) 34 MVR 234. 16 Special leave transcript, 9 August 2002 at 7-8. See also Russo v Aiello (2002) 23 (15) Leg Rep SL1 where further statistics are given. 17 Special leave transcript, 9 August 2002 at 8. 18 Since the Limitation Act 1623 (UK). 19 Reasons of Gummow and Hayne JJ at [36]-[41], [46]-[56], [60]. Kirby Given the common unpredictability of accident outcomes, prudence might have suggested that the solicitor take steps in January 1997 to ensure that the claimant's position as to the time for making a claim under the Act was protected, by proposing that the form be completed there and then (or at least that some letter of claim be sent to the insurer). No fee or disadvantage attached to lodging such a claim. But that course was not adopted. The claimant returned to Australia in December 1997. He resumed work. Eventually, in October 1998, he consulted new solicitors. He received specialist medical advice in January and February 1999. Only then, on 23 March 1999, did he complete a claim form. It was lodged 26 months after the accident in which his cause of action (and that of the second appellant, his employing company) first arose. Substantial claim – time problem: But for the operation of the Act, there would have still been ample time for the claimant to bring an action for damages. The driver alleged to be responsible for the accident was known and identified. He held a compulsory third party risk insurance policy. The claimant was innocent of any negligence, being a passenger in the driver's vehicle. The circumstances of the accident appear to indicate negligence on the part of the driver in controlling his vehicle, which ran off the road and struck a rockface. There seems to have been no doubt about the occurrence of the accident. The police attended the scene. The claimant was taken thence to hospital by ambulance. The hospital records confirmed the claimant's history. The claimant alleged that he suffered injuries that resulted in disabilities such that, if his claim succeeded, the award of damages would be more than 10 per cent of the maximum amount for non-economic loss under ss 79 or 79A of the Act20. The last-mentioned aspect of his claim was not contested by the insurer. The medical evidence before the courts below suggested that the claimant had suffered an injury, among others, to his cervical spine. Objective tests indicated a disc protrusion. That evidence demonstrated that in May 1999, there was a significant residual disability in the claimant's neck estimated at a ten per cent loss of efficient function. This was said to be permanent. It had serious consequences for the claimant's occupation as a chef and restauranteur. Approach of strict scrutiny of the Act I mention these factual details because any rational application of the Act to the claimant's case (as may be imputed to the Parliament which enacted the Act) would not overlook such commonplace circumstances in deciding the 20 Act, s 43A(4). See reasons of Gummow and Hayne JJ at [52]. Kirby consequences of any time default in making a claim and commencing proceedings. As the Attorney-General said in introducing the Bill containing the amendments that incorporated some of the provisions in question in this appeal21: "Common sense and community expectations generally demand that the [compulsory third party] policy provide coverage in respect of injuries which arise from crashes … on the roads or from vehicles running out of control." On the face of things, the same is true of the entitlement to damages for the injuries suffered by the claimant. The claimant's claim, notified a little more than two years after it arose, was therefore one involving an objectively established accident, apparently clear liability in negligence, a driver indemnified by a viable insurer and potentially serious disabilities of a kind that, experience teaches, sometimes take a period to manifest themselves. In such circumstances, in order to deprive a person of the entitlement to damages otherwise arising for the civil wrong done to him, on the basis of a procedural default in making a claim and commencing proceedings in time, the legislation would need to be clear. Any ambiguity or uncertainty in its terms would be construed in a way that would preserve the civil rights of the person injured. If this is so with respect to rights of an ancillary kind (such as a corporation's right to have access to the advice of a lawyer22) it is much more so for substantive rights of an individual in something as basic as a cause of action in tort23. A court must give effect to the meaning of legislation as derived from the words in which it is expressed. But deriving that meaning is not a mechanical task. It is one that calls forth evaluation and judgment. The scheme of the Act Barriers to a late claim: From the provisions of the Act set out in the reasons of Gummow and Hayne JJ24, it can be seen that the New South Wales Parliament intended to introduce strict requirements for the prompt bringing of claims "for damages in respect of … injury to a person caused by the fault of … 21 New South Wales, Legislative Council, Parliamentary Debates (Hansard), 16 November 1995 at 3322. 22 Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 77 ALJR 40; 192 ALR 561. 23 cf Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 307 per Mason CJ, Deane and Gaudron JJ, 312 per Brennan J. 24 Reasons of Gummow and Hayne JJ at [46]-[56], [60]. Kirby [a] driver of a motor vehicle in the use … of the vehicle"25. The present claimant was a person who made, or was entitled to make (but for any disqualifying provisions in the Act), such a claim26. The objects of the amendments to the Act included the introduction of "a stricter procedure for the making and assessment of claims for damages"27 to protect the need to investigate claims properly28. The objects of the obligation to make a claim upon those liable within six months of the relevant date for the claim (in this case, the date of the accident) included the early commencement of investigations by insurers; the prompt access by the injured person to rehabilitation; and the provision to insurers of the facility to formulate their premiums based on claims experience29. Nevertheless, where (as in the present case) a claim was made more than six months after the relevant date, and was thus a "late claim", the claim might still proceed to determination on its merits "if the claimant provides a full and satisfactory explanation for the delay in making the claim"30. Evidence about any delay in the onset of symptoms relating to the injury as a result of the motor accident might be one such explanation31. However, it was not the only explanation. The terms of the Act suggest that, to be effective, the explanation required provision of the details of relevant facts and circumstances. An added barrier to a "late claim" was imposed by the Act where the claim was made more than 12 months after the relevant date. Then the claimant was not only obliged to provide a "full and satisfactory explanation" but also to show that the awardable damages were of a certain amount (a condition satisfied in the present case)32. By the terms of the Act, the claimant was to "provide" the explanation specified "in the first instance to the third-party insurer concerned (if 25 Act, s 40(1) (definition of "claim"). 26 Act, s 40(1) (definition of "claimant"). 27 Act, s 2A(1)(c)(ii). 28 Act, s 43(1)(a) set out in the reasons of Gummow and Hayne JJ at [49]. 29 Act, s 2A(1)(c). See also s 40A set out in the reasons of Gummow and Hayne JJ at 30 Act, s 43A(2). 31 Act, s 43A(3). 32 Act, s 43A(4). Kirby there is one) or to the Nominal Defendant"33. Note that, at this point, the Act states that the explanation must be "provided" by the claimant. The scheme of the Act then proceeds with a bifurcated provision dealing with the case where the claimant's claim is (as here) a "late claim". Peremptory dismissal on condition: Provision is first made for what might be called a "fast track" procedure by which the insurer (or the person against whom the claim is made) may apply to have the proceedings which the claimant brings dismissed "on the ground of delay"34 (or, if applicable, on the ground that the amount of damages did not meet the statutory precondition35). This "fast track" is itself subject to a number of requirements which the insurer (or person against whom the claim is made) must establish in order to gain the benefit of the procedure: the claim must be a "late claim"36; it must be made against a person who is insured by a third-party insurer37; the insurer must not within two months after receiving the late claim have failed to reject the claim or to have asked the claimant to provide a full and satisfactory explanation for the delay in making the claim38; the insurer must within two months after receiving an explanation have rejected the explanation39; and court proceedings must have been commenced in respect of the late 33 Act, s 43A(2). 34 Act, s 43A(6)(c). 35 Act, s 43A(6)(c)(ii). 36 Act, s 43A(6). 37 Act, s 43A(6). 38 Act, s 43A(6)(a). 39 Act, s 43A(6)(b). 40 Act, s 43A(6)(c). Kirby Only if all of the foregoing preconditions were fulfilled might an insurer obtain the advantage of the special procedure, in effect, to secure the peremptory termination of the claimant's entire proceedings. This is clear because of the conditions that circumscribe the insurer's remedy. If certain of the conditions were not met (namely (c) and (d)) the insurer would lose "the right to challenge the claim on the ground of delay"41. Note that the right referred to is to "challenge the claim". If court proceedings have already been commenced (normally brought by or for the claimant) the insurer "may apply to have the proceedings dismissed"42. Three observations can be made about this last-mentioned provision. First, it is expressed in the permissive ("may"). Any objections that the insurer (or relevant person) may have in respect of a "late claim" will remain to be decided at the trial if the "fast track" procedure is not invoked by the insurer (or such person) or does not succeed. That procedure is thus an option belonging to the donee of the statutory entitlement. It is not obligatory that it be availed of. It does not represent the only way, or time, to raise an objection about the lateness of the claim (or the insufficiency of the prospective damages). Secondly, the respective paragraphs of s 43A(6) (s 43A(6)(a), (b) and (c)) draw a distinction between challenges to the "claim" and applications with respect to the "proceedings". The "fast track" in s 43A(6) of the Act provides an additional statutory entitlement to the insurer (or relevant person) to apply for the termination of "the proceedings". Thirdly, what is envisaged by the sub-section is more than an objection going to an important issue (such as a "challenge" to a "claim on the ground of delay"). It is a provision for relief to have the entire proceedings dismissed. In such a procedure, the insurer (or relevant person), being the party who has exercised the entitlement to apply, is the applicant for such relief. In the ordinary way, as applicant, it bears the burden of making out its entitlement. Attention to "having" an explanation: In the bifurcated scheme of the Act provision is then made, in general terms, for the way in which a court will deal with the issue of a late claim, whether under the "fast track" procedure pursuant to s 43A(6), available to the insurer or other person liable43, or more generally, for example, pursuant to a motion for summary dismissal of the proceedings, as ancillary to some other interlocutory hearing, or in the disposition of the substantive action on its legal merits. It is in order to cover all such instances 41 Act, s 43A(6)(a)-(c). 42 Act, s 43A(6)(c). 43 "Insurer" in s 43A(6) includes the Nominal Defendant in cases in which that office- holder is concerned. Kirby that s 43A(7) provides that a court "must dismiss proceedings commenced in respect of a late claim if the court is satisfied" that the two criteria specified are met. The bifurcation that I have described is given significance by a distinction appearing in the language of the Act to which several judges of the New South Wales Court of Appeal have drawn attention44. Hodgson JA did so in his dissent in the present case45. In Manderson v Ellis, Davies AJA put it this way46: "The subsection [s 43A(7)] requires that the court be satisfied that, 'the claimant does not have a full and satisfactory explanation for the delay in making the claim'. Unlike s 43A(2), (4) and (6)(a), the provision does not use the term 'provide', 'provided' or 'provision'. The onus necessarily fell upon [the insurer or person against whom the claim is made], who was the applicant for the order of dismissal, to establish that the respondent did not have a full and satisfactory explanation for the delay. Of course, an explanation actually provided by or on behalf of an injured party will be strong evidence of the explanation which the person has." The distinction drawn by Hodgson JA and Davies AJA is a material one. As other cases involving s 43A(7) illustrate, it will often be the case that a person who has consulted a legal practitioner within time to make a claim will be individually innocent – or relatively so – for the failure to make the claim or bring the proceedings within the very short time-frame established by the Act for taking such steps. The person or the person's lawyer may not have provided a full and satisfactory explanation, but it may nonetheless appear that the claimant has one and, at the trial, upon detailed evidence, could establish one. The hazards contained in the Act are serious for the uninstructed person, given the severe abbreviation of the time for making claims and bringing proceedings; the supposed encouragement afforded to the settlement of claims without resort to court proceedings; and the actual imposition of a prohibition upon a claimant's commencing proceedings in respect of a claim within six months from notice, or 90 days after required details are given to an insurer, or 28 days from an offer of settlement to the claimant by the insurer, whichever is the latest or the last of such events to occur47. Complex moveable time limits of 44 See for example Manderson v Ellis (2002) 37 MVR 214 at 219 [19] per Santow JA, 225 [54] per Davies AJA. 45 Russo v Aiello (2001) 34 MVR 234 at 236 [6]. 46 (2002) 37 MVR 214 at 225 [54] (emphasis added). 47 Act, s 52(1A). Kirby this kind are bound to lay traps for people with claims (and probably also for not a few lawyers upon whom some claimants rely). In such matters, claimants are virtually forced into dependence upon legal advice. Such advice requires a degree of vigilance and a sense of urgency on the part of the lawyers. The distinction between the sections of the Act addressed to the "provision" of a full and satisfactory explanation and s 43A(7), has been of particular importance in cases where the claimant is personally innocent of the delay but has been poorly represented by an incompetent or neglectful lawyer48. In such cases, correctly in my view, the Court of Appeal has given effect to the point of differentiation in the statutory language that Hodgson JA identified in the present case. Ambiguity and deprivation of rights: To the extent that the provisions of s 43A of the Act are ambiguous, the construction favoured by Hodgson JA in the Court of Appeal should be adopted. It is supported by the language of the Act; the restraint that ordinarily governs the peremptory termination of proceedings by courts without a trial on the merits49; and the considerations of legal policy mentioned at the outset of my reasons50. It follows that the inquiry by a court, asked to dismiss proceedings commenced in respect of a "late claim", is directed to whether the court is satisfied that the claimant does not "have" a full and satisfactory explanation for the delay. If the court is so satisfied it "must" dismiss the proceedings. Where that inquiry is carried out in the final hearing of the trial, obviously the court will decide the issue so presented finally, upon all of the evidence adduced at the trial. When, however, the inquiry is carried out in the context of an interlocutory motion brought by the insurer (or relevant person) before a final hearing, or as part of the "fast track" procedure afforded on condition to such parties, the disposition may be provisional. If the insurer (or relevant person) fails to obtain such relief, that conclusion is not necessarily a final disposition of the objection about the lateness of the claim or of the late commencement of the proceedings. The judge deciding the motion will bear in mind that the burden of proof, normal to the final resolution of such proceedings, is reversed; the claimant does not, as a matter of law, have to prove anything. Although the motion may succeed, if it 48 As in Diaz v Truong (2002) 37 MVR 158; Manderson v Ellis (2002) 37 MVR 214. 49 General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 129-130; cf Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 at 155, 167-172; Jackamarra v Krakouer (1998) 195 CLR 516 at 521-522 [7]-[9], 539-543 50 Above at [91]. Kirby fails, it does not necessarily mean that the issue will not ultimately be resolved in favour of the insurer (or relevant person) on the basis of all of the evidence adduced by both sides at the final hearing. The errors of the primary judge Errors of law and fact: In the determination of the respondent's motion, brought pursuant to the "fast track" provided by s 43A(6) of the Act, the primary judge in this case did not approach the issues for decision in the foregoing way. He made two relevant errors. As they represent common ground in this Court, I will not elaborate them but simply state what they were. First, his Honour expressed the burden of proof in the motion as being upon the claimant. I agree with Gummow and Hayne JJ and with the members of the Court of Appeal, that if (as I consider) this means that the claimant "bore the onus of proving that the explanation he had given was full and satisfactory, it was an error"51. It represented a mistake of law. Secondly, the primary judge erred by stating that, apart from par 10 of the claimant's statutory declaration, filed in connection with the motion, "there is no further information given in relation to the [claimant's] work activities, if any, from 6 December 1997 to 6 October 1998"52. As Hodgson JA pointed out in the Court of Appeal53 (and as McHugh J and Gummow and Hayne JJ have accepted in this Court54) that statement was not correct. There was other evidence. It needed to be evaluated in reaching a conclusion on the relevant issue, namely whether the claimant did "not have a full and satisfactory explanation for the delay in making the claim"55. This, then, was a second mistake. It was a mistake of fact. Consequences of the errors: These mistakes of law and fact vitiated the decision of the primary judge56. He approached the resolution of the issue in the incorrect way. He failed to take into account relevant evidence. Neither the mistake nor the omission could be regarded as immaterial. As was common ground, the ultimately critical question was whether the explanation for the 51 Reasons of Gummow and Hayne JJ at [64]. See also reasons of McHugh J at [26]. 52 Cited in Russo v Aiello (2001) 34 MVR 234 at 236 [9]. 53 Russo v Aiello (2001) 34 MVR 234 at 236 [8]. 54 Reasons of McHugh J at [26]; reasons of Gummow and Hayne JJ at [69]. 55 Act, s 43A(7). 56 See reasons of McHugh J at [28]. Kirby "delay in making the claim" between 6 December 1997 and 6 October 1998 was "full" and satisfactory57. In his reasons, Hodgson JA itemised a number of elements of the additional evidence specifically pertinent to that period. Such evidence included particulars, admitted without objection, which Hodgson JA58 was prepared to treat as evidence of the fact of the assertions in them59. These covered intervals of, and absences from, work between January 1997 and March 1999. Then there were reports from medical specialists, dated 10 December 1998 and 31 May 199960, who had treated the claimant and who related the history given by him between December 1997 and May 1999. In addition, there was an affidavit by the claimant dated 14 October 2000. It elaborated his earlier statutory declaration to the effect that, at first, he had considered that his condition would resolve (as for a time it seemed to do) and then "[o]ver a period of time" he had "formed the view that my disabilities were not going to improve and that some have in fact … become worse, affecting my life to a greater extent than I had initially believed they would"61. In light of the material errors of law and fact identified, it was clear that, on the face of things, the primary judge's orders could not stand. The Court of Appeal had the authority in those circumstances to set aside those orders. The real question in the Court of Appeal was whether that Court should remit the decision on the respondent's motion to the District Court to be made afresh without the errors demonstrated or whether it would make the decision on the motion for itself. The errors of the Court of Appeal Procedural error of Court of Appeal: The majority in the Court of Appeal (Young CJ in Eq with whom Meagher JA agreed) decided simply to affirm the primary judge's decision. As McHugh J has demonstrated, the course that was adopted in that disposition was wrong62. Having correctly found error at trial, the Court of Appeal was required to set aside the order made at trial and then remit the discretion to the District Court to be exercised there again lawfully, or to assume the obligation of exercising the discretion on the record for itself. This it did not do. 57 Russo v Aiello (2001) 34 MVR 234 at 236 [9]. 58 Russo v Aiello (2001) 34 MVR 234 at 237 [11]-[12]. 59 Pursuant to the Evidence Act 1995 (NSW), s 136; cf ss 60 and 75. 60 Russo v Aiello (2001) 34 MVR 234 at 237-238 [13]-[15]. 61 Russo v Aiello (2001) 34 MVR 234 at 238 [14]. 62 Reasons of McHugh J at [28]-[29]. Kirby As the process of appeal before the Court of Appeal miscarried, this Court, in the appeal to it, should set aside the Court of Appeal's erroneous order and, on the record, reconsider the primary decision for itself63. Somewhere in the judicial hierarchy of Australia the claimant is surely entitled to have one judicial tribunal correctly exercise the discretionary power that has the effect of depriving him of significant legal rights, doing so lawfully and by reference to the correct criteria. Relief was not futile: Assuming, however, that this Court should consider, as McHugh J does64, whether relief should be refused because, to grant it, would be futile, I am not convinced that such is the case. In my view, the claimant is entitled to relief from this Court. First, Young CJ in Eq said65: "there may be errors of process, [but] ultimately I can see no error in his Honour's conclusion. The conclusion he reached was one which he was entitled to reach on the material before him: I can see no appealable error." As I have shown, there were clear appealable errors. They were not, as the majority in the Court of Appeal thought, merely errors of process. They went to the very heart of the primary judge's failure to take the correct approach as required by the Act. Importantly, they involved disregard for much of the evidence pertinent to the issue that had to be decided. Secondly, Young CJ in Eq postulated a hypothetical case of what would ensue if he were of the view (which he was not) that the errors were sufficient to warrant setting aside the primary judge's decision and "exercising the jurisdiction on the merits in this court"66. Such hypothetical speculations can distract the decision-maker from the kind of analysis of evidence and balancing of factors that is essential if the primary decision is to be properly re-exercised. This, in my belief, is the error that happened here. The Court of Appeal majority did not proceed to demonstrate its consideration of the additional evidence and to assign the burden of proof correctly to the respondent who was seeking the "fast track" 63 cf Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 879-880 [65]; 179 ALR 321 at 336-338; Fox v Percy (2003) 77 ALJR 989 at 995-996 [32]; 197 ALR 201 at 210. 64 Reasons of McHugh J at [33]. 65 Russo v Aiello (2001) 34 MVR 234 at 243 [52]. 66 Russo v Aiello (2001) 34 MVR 234 at 243 [53]. Kirby remedy. Instead, Young CJ in Eq contented himself with saying that he "would still reach the conclusion that there was not a full and satisfactory reason given for the delay in this case"67. Effectively, this meant that the decision, which had miscarried at trial, was not properly made on appeal68, despite the demonstration of vitiating errors and despite the seriousness of the consequences for the claimant who was then effectively put out of court. Thirdly, as Hodgson JA pointed out69, the reasoning of Young CJ in Eq was addressed, in terms, to whether or not the claimant had given a full and satisfactory explanation. However, the Act required the decision-maker to address a broader question: whether the claimant had such an explanation. That question fell to be answered in a motion brought by the respondent seeking special, peremptory relief before a trial on the merits relying on an affidavit of the respondent's solicitor annexing the claimant's statutory declaration and other material provided to the insurer70. In a proper case, where enough was shown to suggest that the merits (including the merits of the "explanation") should be explored at the trial of the action, that was the proper place for the issue to be decided. At trial, not in the "fast track" hearing. On the evidence in the motion before the primary judge in this case, looked at as a whole, this was what should have happened. Fourthly, Young CJ in Eq acknowledged, correctly in my view: "It is, of course, a drastic step to take of refusing plaintiffs who have a fairly arguable case in negligence the right to go to trial, especially if the insurer suffers no prejudice in what has occurred"71. Yet, whilst mentioning this consideration, his Honour did not, with respect, give it due weight. It required, at the least, a separate demonstration (effectively for the first time) that the claimant did "not have a full and satisfactory explanation for the delay". As well, it obliged consideration to be given to whether, in the way the trial had been conducted, the claimant might have had such an explanation which would come out more fully in the resolution of the issue at a 67 Russo v Aiello (2001) 34 MVR 234 at 243 [53]. 68 See reasons of McHugh J at [29]-[30]. 69 Russo v Aiello (2001) 34 MVR 234 at 239 [22]. 70 cf reasons of Gleeson CJ at [9]-[10]; reasons of Gummow and Hayne JJ at [58]- 71 Russo v Aiello (2001) 34 MVR 234 at 243 [50]. Kirby trial on the merits which his Honour rightly pointed out was the normal entitlement of both parties. Fifthly, I cannot agree with the suggestion by the other members of this Court72 that prejudice to an insurer (or person indemnified in respect of motor vehicle liability) is irrelevant to the decision necessitated by s 43A(6) of the Act. In this, I agree with the approach that Young CJ in Eq took in the passage just quoted. It is more consonant with the overall scheme and purpose of the Act and with the discretion reposed in the trial judge. It conforms to several of the Act's provisions. In judging whether evidence constitutes an "explanation" that is "full and satisfactory", it is proper to view the testimony in its entirety and in its context. Two obviously relevant considerations in that regard will be any prejudice that has been suffered by the respondent in consequence of the delay (beyond that which will be imputed to the ordinary operation of the Act) and any prejudice that will be suffered by the claimant by being denied the chance to have a trial on the merits of what may otherwise be an apparently viable and genuine claim, brought upon proceedings commenced (as here) within the outer time limit of three years set by the Act73. In a claim where there are real doubts about the happening of the accident, questions about the identity of the driver or owner of the motor vehicle, issues raised by the failure to report the matter to the police or fundamental disputes over the injuries and disabilities claimed, what will be an "explanation" and one that is "full and satisfactory" will be different from the case (as here) where no such elements of prejudice to the respondent are present or proved, or even suggested. Likewise, where a claimant is profoundly injured, was initially poorly represented by the "explanation" required for the delay and whether it is "full and satisfactory" will be moulded to such circumstances. lawyers and has grave and permanent disabilities, It is unrealistic to ignore the issue of prejudice in making a decision conferred by the Parliament upon judges obliged to decide whether default in time compliance will prevent a party having a trial of a claim on its merits. Of course, any such prejudice must be judged within the context of the strict scheme established by the Act. But it is not irrelevant to the determination of the acceptability of the "explanation" and whether, in the circumstances, that 72 See reasons of Gleeson CJ at [7]; reasons of McHugh J at [25]; reasons of Gummow and Hayne JJ at [61]. 73 Act, s 52(1)(b) and (4). See also s 52(4A) and (4B). Kirby explanation is "full and satisfactory". The Court of Appeal should have given weight to the primary judge's failure to consider this issue. Sixthly, it is important to take into account the rather unsatisfactory way in which the primary judge's error concerning the burden of proof on the motion led him to conduct the hearing at first instance. In the Court of Appeal74 the claimant did not eventually press a separate ground of complaint based upon a want of procedural fairness (natural justice) in the proceedings at first instance. However, alike with Hodgson JA75, and notwithstanding this concession, I am of the view that the way the trial was conducted was highly relevant to the statutory question of whether the claimant "had" a full and satisfactory explanation for the delay in making his claim. As Hodgson JA put it76: "In this case, until submissions were made before the primary judge, no indication was given by the respondent of the respects in which it alleged the appellants' explanation was less than full and satisfactory. The respondent's notice of motion sought dismissal of the proceedings 'upon grounds set forth in the affidavit of [the solicitor] sworn and filed herein'. That affidavit annexed the first appellant's statutory declaration dated 23 March 1999 and the insurer's letter in response, but did not indicate any grounds on which the explanation in that statutory declaration was said to be less than full and satisfactory. The insurer's letter did not itself specify any reason for not accepting the appellants' explanation. Before the primary judge, the first appellant was not cross-examined on his affidavit. Notwithstanding that the onus was squarely on the respondent to prove the absence of an explanation, the respondent chose not to specify any respect in which the explanation was said to be deficient, and chose not to cross- examine the first appellant on his affidavit. Whether or not the material actually provided to the court does itself amount to a full and satisfactory explanation, in my opinion it would be quite wrong to draw the inference against the appellants in those circumstances that they do not have a full and satisfactory explanation. 74 Russo v Aiello (2001) 34 MVR 234 at 239 [19]. 75 Russo v Aiello (2001) 34 MVR 234 at 239 [20]. 76 Russo v Aiello (2001) 34 MVR 234 at 239 [18], [21], [22] (original emphasis). Kirby For my part, particularly having regard to the way the respondent conducted its application, I am not so satisfied. The legislature could have made an application of the kind made in this case depend upon whether or not a claimant had given a full and satisfactory explanation, and indeed could have imposed the onus of proof on the claimant. But it did not do so. It made such an application depend upon whether or not the claimant had a full and satisfactory explanation, and imposed the onus of proof on the defendant." Outcome – appeal allowed: Hodgson JA's approach to the appellate function was correct. So was his analysis of the operation of the Act. His examination of the evidence is thorough and convincing. His conclusion as to the proper outcome in this particular case is compelling. I disagree with the opinions in this Court that reach the contrary result. In my view, they are legally flawed and factually unjust. Conclusions and orders The Act introduced severe time limits upon claims and proceedings arising out of motor vehicle accidents in New South Wales. That is true. But the application of the time provisions and the determination of whether, in the particular case, default should be fatal for a claimant or should be excused in the circumstances, were committed to judicial decision in an envisaged procedure before a court of justice. Before the claimant was deprived, for time default, of what otherwise appeared to be a significant and strongly arguable cause of action, it was essential that a hearing be conducted in which the nature of the respondent's motion was properly understood by the decision-maker; the burden of proof in the motion was correctly assigned to the party bearing it; and the entirety of the evidence adduced as relevant to the issue to be decided was manifestly taken into consideration in reaching the court's conclusion. None of this happened in the present case. The attempt, on appeal, to correct the primary judge's errors led to further errors on the part of the majority of the Court of Appeal which then, on the basis of these errors, confirmed the primary judge's flawed orders without correctly discharging its own function. My own inclination would have been to remit such a defective proceeding to be re-heard, starting afresh, in the District Court. However, as nothing turns upon my disposition of the appeal, I will content myself by proposing that the orders favoured by Hodgson JA should be adopted. The appeal should be allowed with costs. The judgment of the Court of Appeal of the Supreme Court of New South Wales should be set aside. In place of that judgment it should be ordered that the appeal to that Court be allowed Kirby with costs; the judgment of the primary judge set aside and, instead, the insurer's motion for relief under s 43A(6) of the Act should be dismissed.

HIGH COURT OF AUSTRALIA THE QUEEN APPELLANT AND The Queen v Keenan [2009] HCA 1 2 February 2009 Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Queensland made on 11 December 2007 and, in their place, order that the appeal against conviction to that Court be dismissed. Remit the matter to the Court of Appeal of the Supreme Court of Queensland to determine the application for leave to appeal against sentence. On appeal from the Supreme Court of Queensland Representation W Sofronoff QC, Solicitor-General of the State of Queensland with R G Martin SC for the appellant (instructed by Director of Public Prosecutions (Qld)) B W Walker SC with A J Kimmins for the respondent (instructed by Potts Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS The Queen v Keenan Criminal law – Criminal responsibility – Criminal Code (Q), s 8 provided that, where common intention to prosecute unlawful purpose, and in prosecution of such purpose offence committed of such a nature that commission was a probable consequence of prosecution of unlawful purpose, each person deemed to have committed offence – Meaning of "offence … of such a nature" – Whether "offence … of such a nature" limited to precise acts committed. Criminal law – Criminal responsibility – Nature of connection between unlawful purpose and offence ultimately committed – Determination of unlawful purpose – Relevance of means by which offence committed – Whether purpose may be infliction of level of harm – "Probable consequence" as objective test – Distinction between offence of such a nature that commission was probable consequence of prosecution of unlawful purpose, and precise acts that parties to common intention foresaw might be committed. Criminal law – Practice and procedure – Directions to jury – Directions required in connection with charge under s 8 – Identification of real question for jury – Relevance of R v Barlow (1997) 188 CLR 1 – Whether directions given gave rise to miscarriage of justice. Criminal law – Practice and procedure – Directions to jury – Whether circumstances required direction that jury can only find, by inference, element of offence charged if no other inference favourable to accused reasonably open on facts – Standard of proof. Criminal law – Practice and procedure – Directions to jury – Whether that alternative charge of grievous bodily harm circumstances required simpliciter be put to jury – Whether failure to put alternative charge to jury constituted miscarriage of justice. Criminal law – Practice and procedure – Where alleged miscarriage arising from jury direction – Appropriate course on appeal – Whether Court of Appeal should have ordered new trial rather than entering verdict of acquittal. Words and phrases – "common intention", "common purpose", "offence of such a nature", "probable consequence", "unlawful purpose". Criminal Code (Q), ss 2, 7, 8, 10A. KIRBY J. This appeal from unanimous orders of the Court of Appeal of the Supreme Court of Queensland1 once again2 requires this Court to consider the meaning and application of s 8 of the Criminal Code3 (Qld) ("the Code"). That section defines the criminal liability of secondary offenders who form an intention to prosecute an unlawful purpose during the execution of which a crime is committed by the primary offender. In R v Rahman, Lord Bingham of Cornhill observed4: "Any coherent criminal law must develop a theory of accessory liability which will embrace those whose responsibility merits conviction and punishment even though they are not the primary offenders. English law has developed a small number of rules to address this problem, usually grouped under the general heading of 'joint enterprise'. These rules, as Lord Steyn pointed out in R v Powell (Anthony); R v Edwards5, are not applicable only to cases of murder but apply to most criminal offences." As the Privy Council said in Brown v The State (Trinidad and Tobago)6: "The simplest form of joint enterprise, in the context of murder, is when two or more people plan to murder someone and do so. If both participated in carrying out the plan, both are liable. It does not matter who actually inflicted the fatal injury. This might be called the paradigm case of joint enterprise liability … [or] the plain vanilla version of joint enterprise." Lord Bingham of Cornhill in Rahman said that in R v Powell (Anthony), the Privy Council had to consider a more difficult question7: 1 R v Keenan [2007] QCA 440. 2 See R v Barlow (1997) 188 CLR 1; [1997] HCA 19. 3 The Code is a Schedule to the Criminal Code Act 1899 (Qld). [2008] 3 WLR 264 at 267-268 [7]-[8]; [2008] 4 All ER 351 at 355. [1999] 1 AC 1 at 12. [2003] UKPC 10 at [8] and [13]; cf Chan Wing-Siu v The Queen [1985] AC 168 at [2008] 3 WLR 264 at 268 [10]; [2008] 4 All ER 351 at 356 citing R v Powell (Anthony) [1999] 1 AC 1 at 16 per Lord Hutton. Kirby "[T]he liability of a participant in a joint criminal enterprise when another participant in that enterprise is guilty of a crime, the commission of which was not the purpose of the enterprise." The reasons of this Court should not be needlessly encumbered with references to dicta in cases of this kind that have arisen under the laws of the several jurisdictions of Australia and overseas. The cases usually arise, as here, in the context of contested directions given to a jury at trial. Ultimately, however, the question for decision is comparatively straightforward. In Queensland, it is resolved by examining the text of s 8 of the Code, ascertaining its meaning and then applying that meaning to the facts and circumstances of the case. As will be shown, there is an ambiguity in the meaning of that section. It has been acknowledged in earlier decisions of the Queensland courts8 and of this Court9. In resolving the ambiguity, we are assisted in this appeal by the forthright ways in which the respective interpretations favoured below were successively stated by the trial judge in the Supreme Court of Queensland before whom Mr Francis Keenan ("the respondent") was tried (de Jersey CJ), and by the Court of Appeal which upheld his challenge to the trial judge's directions to the jury. The Court of Appeal decided that no retrial should be ordered. It quashed the respondent's conviction and ordered his acquittal. In essence, the trial judge was of the view that, properly interpreted, s 8 of the Code required the jury to decide whether a generic offence ("to inflict a serious assault … by way of revenge or retribution" on the victim) was sufficient (although he was a secondary offender) to render the respondent liable for the "offence" committed by his co-accused, Mr Dion Spizzirri. He so instructed the jury10. By reference to authority, the Court of Appeal rejected the trial judge's approach. It held that s 8 of the Code requires that directions be given to the jury addressing the features of the "offence" by Mr Spizzirri and asking whether that offence, as executed by him, had been proved to be within the "common intention to prosecute an unlawful purpose" in the course of committing which the happening of an offence "of such a nature" was a probable consequence. 8 See eg R v Jervis [1993] 1 Qd R 643 at 652. 9 See eg Barlow (1997) 188 CLR 1 at 32-33. 10 The passage is cited at [2007] QCA 440 at [4]. Kirby The majority of this Court now endorses the view taken by the trial judge as to the meaning of s 8 of the Code11. It accepts the accuracy (and sufficiency) of his directions to the jury framed at a level of "generic" generality. I disagree. I do so by reference to: The language and purpose of the Code; The authority of this Court in R v Barlow12, which the Court of Appeal correctly applied; The general conformity of the Court of Appeal's interpretation with concurrent developments in the common law upon a shared question of basic criminal liability; Other considerations of legal principle and policy to which reference may properly be made in deciding the controversy; and The elements in the evidence at trial which illustrate the correctness of the Court of Appeal's decision about the error found in the trial judge's directions. These reasons will seek to show that the interpretation of s 8 of the Code favoured by the Court of Appeal was the correct one. However, with respect to that Court, having found an error in the directions given to the jury by the trial judge, the relief proper in the circumstances was not acquittal of the respondent but an order for retrial where a fresh jury could be properly instructed on the governing law. Such an order was not futile. Upon this view, and the orders that follow it, an outstanding sentencing appeal, brought by the respondent, does not arise for consideration at this stage. The facts and legislation The facts: Most of the facts relevant to these reasons are contained in the reasons of Kiefel J13. Her Honour also sets out critical passages in the directions which the trial judge gave to the jury14 and provides references to some of the key passages in the reasons of the Court of Appeal, explaining the contrary 11 See reasons of Hayne J at [84] and reasons of Kiefel J at [126]-[127]. 12 (1997) 188 CLR 1. 13 Reasons of Kiefel J at [94]-[99]. 14 Reasons of Kiefel J at [106]. See also [2007] QCA 440 at [22]. Kirby opinion it held on the principal issue15. I incorporate this material by reference. I will elaborate it only to the extent that is necessary to do so in highlighting my points of difference from the majority reasoning. The legislation: Also set out in the reasons of Kiefel J are relevant excerpts from, or references to, the provisions of the Code16. The central issue in the appeal concerns the meaning of s 8. It is as well to repeat that provision: "When 2 or more persons form a common intention to prosecute an unlawful purpose in conjunction with one another, and in the prosecution of such purpose an offence is committed of such a nature that its commission was a probable consequence of the prosecution of such purpose, each of them is deemed to have committed the offence." Just as important for these reasons, (as demonstrated in the earlier analysis of this Court in Barlow17) is the definition of "offence" contained in s 2 of the Code. That word is there given prominence and elaboration in a separate definitional section which reads18: "An act or omission which renders the person doing the act or making the omission liable to punishment is called an 'offence'". It is also important to note the provisions that surround s 8 in the Code. Most significant, as the Court of Appeal acknowledged19, are the terms of ss 7, 9 and 10A of the Code. Because of the way it was deployed in argument by both sides, the language of s 9 should also be set out20: "(1) When a person counsels another to commit an offence, and an offence is actually committed after such counsel by the person to whom it is given, it is immaterial whether the offence actually committed is the same as that counselled or a different one, or whether the offence is committed in the way counselled, or in a different way, provided in either case that the facts constituting the 15 Reasons of Kiefel J at [107]-[113]. 16 Reasons of Kiefel J at [100]-[102]. 17 (1997) 188 CLR 1. 18 See also [2007] QCA 440 at [28]. 19 [2007] QCA 440 at [29]-[32]. 20 [2007] QCA 440 at [31] (emphasis added). Kirby offence actually committed are a probable consequence of carrying out the counsel. In either case the person who gave the counsel is deemed to have counselled the other person to commit the offence actually committed by the other person." The issues Issues in the appeal: Three issues arise in the appeal, namely: (1) Meaning of s 8 of the Code: What is the meaning and proper application of s 8 of the Code? Is it the meaning attributed by the trial judge or the different meaning preferred by the Court of Appeal? Having regard to the assigned meaning, were the directions given by the trial judge to the jury correct or incorrect in law?; Acquittal or retrial?: If the Court of Appeal was correct in the conclusion that it reached concerning the meaning and application of s 8 of the Code, did it nonetheless err in concluding that no retrial of the respondent should be ordered? Having regard to that Court's entry of a verdict of acquittal, should this Court, in discharging its functions, quash the acquittal and order the retrial of the respondent to give effect to the relief normal to a conclusion that a trial has miscarried by reason of misdirections of law to the first jury?; and Excessive sentence?: In the event that the prosecution succeeds in the appeal to this Court, should this Court decide the still outstanding sentencing appeal or remit it to the Court of Appeal for argument and disposition? Because mine is a minority opinion, it is sufficient for me to state very briefly the conclusions that I would reach on the second and third issues. Resolution of the acquittal issue: As to the second issue (raised by the respondent's ground of appeal 2(d)) it will become apparent that I am of the view that the Court of Appeal erred in entering a verdict of acquittal. I take into account the respect that is owed to the intermediate appellate court in determining whether there has been a miscarriage of justice and, if so, the relief proper to the case, once a jury misdirection is found (as it was here). In disposing of criminal appeals, large powers have been granted by the Queensland Parliament to the Court of Appeal. Upon quashing a conviction for errors in directions at the first trial those powers extend to the substitution of a verdict of Kirby acquittal which will bring the proceedings to a conclusion21. In addition, the Court of Appeal has the power to make an order for a new trial22. Nevertheless, the relief ordinarily appropriate to an identification of significant error in judicial directions, given to a jury in a criminal trial, is the quashing of the conviction and an order for a retrial from which the identified errors will inferentially be expunged23. Such relief gives effect to the limited judicial function in such appeals of correcting legal error whilst respecting the proper province of a jury to resolve all outstanding factual questions. The substitution of a verdict of acquittal is effectively reserved to those cases where, in the appellate court's opinion, no reasonable view of the facts and no accurate application of the law would justify a new trial. In effect, this was the conclusion which the Court of Appeal reached, being of the view that, on the evidence, a fresh jury, properly instructed on the law, could not convict Mr Keenan of doing grievous bodily harm with intent or grievous bodily harm simpliciter in relation to the victim of the serious assault, Upon the premise that, to convict the respondent, it was necessary for the prosecution to establish, on the evidence, that he had formed a common intention with either or both of the other participants (Messrs Spizzirri and Booth) to prosecute an unlawful purpose, a probable consequence of which was that Mr Coffey would suffer grievous bodily harm by an act of shooting, the Court of Appeal concluded that this could not be demonstrated on the evidence tendered at trial. The prosecution should not therefore have a second chance to improve its evidence. The Court of Appeal denied an order of a retrial on the basis that25: "A reasonable jury properly instructed on the present evidence could not honestly exclude the reasonable inference that Spizzirri, in shooting Coffey, was acting independently of the common planned intention." 21 The Code, s 668E. 22 The Code, s 669. 23 cf Dyers v The Queen (2002) 210 CLR 285 at 297 [23] per Gaudron and Hayne JJ, 313-315 [79]-]83] and 316-317 [86]-[90] of my own reasons; [2002] HCA 45. 24 The respondent at his trial was acquitted by the jury of the charge in the first count of the indictment (attempted murder). See [2007] QCA 440 at [1]. 25 [2007] QCA 440 at [60]. Kirby I cannot accept that this was so. Indeed, properly, the respondent's counsel conceded before this Court that the reasoning of the Court of Appeal on this issue was defective26. The alternative ways in which the respondent sought to justify maintenance of the acquittal were unconvincing. The result is that the proper outcome on confirmation of the Court of Appeal's general approach on the first issue, is the substitution by this Court of an order for retrial. Resolution of the sentencing issue: This leaves the appeal against sentence, left undecided by the Court of Appeal given the conclusion it reached on the first two issues. As a matter of general principle, this Court has insisted that, only in exceptional cases will it grant special leave to appeal where the prosecution seeks to appeal against an order quashing a conviction27. However, special leave having been granted to the prosecution in this case, for reasons of general legal principle; the acquittal having been entered by the intermediate court, not after a jury verdict after a trial on the merits28, and the disposition of the proceedings being alive within the Judicature29, it is undoubtedly competent for this Court to make the orders that ought to have been made by the Court of Appeal30. No argument to the contrary was advanced. Similarly, there was no dispute that, if the prosecution were to succeed in restoring the respondent's conviction, as entered at trial, the proceedings would have to be returned to the Court of Appeal to resolve the outstanding sentencing appeal31. The Court of Appeal expressed an opinion that the circumstances of the respondent's offence were not such as to justify the maximum penalty of life imprisonment, imposed by the trial judge32. However, in the event that this issue was revived by this appeal, it would be inappropriate for this Court to resolve it. Apart from everything else, doing so would deprive the parties of the facility to seek appellate review of a fully considered appellate opinion on the subject which has not yet been given. 26 [2008] HCATrans 347 at 3555. 27 R v Van Den Bemd (1994) 179 CLR 137 at 139; [1994] HCA 56. 28 cf Davern v Messel (1984) 155 CLR 21 at 32, 53, 65, 70; cf at 64, 70; [1984] HCA 29 R v Benz (1989) 168 CLR 110 at 112; [1989] HCA 64; cf Gipp v The Queen (1998) 194 CLR 106 at 154-155 [138]; [1998] HCA 21; see also Barlow (1997) 188 CLR 1 at 45 and Palko v Connecticut 302 US 319 at 325 (1937). 30 Judiciary Act 1903 (Cth), s 37. 31 [2007] QCA 440 at [63]. 32 [2007] QCA 440 at [62]. Kirby Having cleared away all of the issues, save for the primary one upon which special leave was granted, it is now appropriate for me to return to the considerations that I have identified earlier in these reasons33. On the primary issue, the nominated considerations bring me to a conclusion different from that reached by the majority of this Court. Textual analysis of s 8 of the Code Definition of offence: Crucial to the respondent's argument, which was accepted by the Court of Appeal, was the submission that the reference in s 8 of the Code to "an offence" picked up the special definition of "offence" expressed in s 2 of the Code. Thus, in identifying whatever was the "offence" committed, for the purpose of enlivening s 8, the word "offence" was not being used in a general, conversational or non-textual sense. It was being used in the special sense defined for this purpose by the Code itself. This approach was apparently accepted by the trial judge. However, the Court of Appeal concluded that it had not been given its correct weight and application. To resolve the question whether, in referring to "an offence [that] is committed" s 8 of the Code intends to refer to the "offence" at a high level of generality ("generic") or at a level of specificity defined by the "acts or omissions" of the primary offender, it is essential to derive as much assistance as can be secured from the statutory definition of "offence" thereby incorporated, by way of s 2, into s 8. When regard is had to the definition in s 2, it is tolerably clear that the word "offence" is addressed to a particular, specific and concrete act or omission "which renders the person doing the act or making the omission liable to punishment". Such a definition supports the respondent's submission that s 8 is addressed not to "offences" of a generic or general kind (as the trial judge said in his instructions to the jury). Instead, it is addressed to the specific acts or omissions that enliven the operation of s 8 to draw a secondary offender (such as the respondent) into criminal liability for the acts or omissions constituting the "offence" committed by the primary offender (here, Mr Spizzirri). Concluding in this way involves nothing more or less than giving the language of s 8 of the Code its meaning, once such meaning is understood with the assistance of the special definition of "offence" contained in s 2. With respect to the trial judge, and to the majority of this Court, this is the basic error of the construction urged for the prosecution. It ignores, or gives insufficient weight to, the precise definition of "offence" stated in the Code. Once that 33 Above, these reasons at [6], [10]. Kirby definition is ignored or not given due weight, it is all too easy for the decision- maker to read s 8 as referring to "an offence" of a "generic" character. But that would be contrary to what s 2 requires the reader of the Code to do, which is to descend into the particularities of the "offence" of the primary offender as it occurred that allegedly attracts the operation of that section to apply to the secondary offender. Thus, in the present case, the definition in s 2 focuses the attention of the Court upon the particular acts or omissions of Mr Spizzirri which are alleged, by virtue of s 8, to impose on the respondent criminal liability for what was done or omitted to be done by someone else in the offence against Mr Coffey. Provisions of s 9 of the Code: There is further textual support for this interpretation in the surrounding provisions of s 9 of the Code. Although that section is not conclusive of the present controversy (and was invoked by the prosecution to advance, by way of contrast, its contrary argument) the threefold mention in s 9(1) of an offence "actually committed", arguably indicates that its provisions, which immediately follow the contested language of s 8, are similarly addressed to the particularities of conduct. So interpreted, ss 8 and 9 are both addressed to the particular facts and circumstances actually constituting "an offence" rather than to the generic descriptions of potential substantive offences found elsewhere in the Code. Although "actually committed" is not an expression that appears in s 8, this can be explained by the respective purposes of ss 8 and 9 of the Code. The drafter appreciated that "offence" in s 8 was intended to attract the definition in s 2. Accordingly, the drafter did not need to repeat a reference to the actual acts or omissions for this was made clear by the use in s 8 of the word "offence", defined in s 2. Trial judge's direction: If this is the correct textual interpretation of s 8 of the Code, the approach adopted throughout the trial judge's directions to the jury fell short of what was required by the focus of the Code upon the particular "acts or omissions" which rendered the person doing the act or making the omission (here Mr Spizzirri) himself liable to punishment. This was obviously not the view which the trial judge took of the meaning and application of s 8. Thus, the trial judge told the jury of the prosecution's contention34: "… that depending on how you assess it the evidence warrants a conclusion that all three accused formed a common intention or plan and that the object of that plan was to inflict some serious physical harm upon Mr Coffey; that the three of them implemented that plan. That in the course of implementing the plan the offence of attempted murder or, alternatively, doing grievous bodily harm with intent was committed and 34 Cited [2007] QCA 440 at [22] (emphasis added). Kirby that the commission of whichever of those offences was committed, was a probable consequence of the implementation of the plan." In the central passage in the trial judge's directions35, his Honour left the issue to be considered by the jury at a general ("generic") level, rather than bringing that issue down so as to oblige the jury to address the particularities of the acts or omissions of Mr Spizzirri which, the prosecution contended, could be brought home to the respondent by way of the common intention liability for which s 8 applies. Court of Appeal's correction: The Court of Appeal noted that the offence of which the respondent was convicted (grievous bodily harm with intent) rested, in part, on expert medical evidence which was unchallenged. This established that the cause of the very serious injury (paraplegia) suffered by Mr Coffey "was the entry of bullets into Mr Coffey's spine"36 amounting to the grievous bodily harm which the prosecution sought to use s 8 of the Code to bring home to the respondent. Given that the prosecution case was that the person responsible for firing the bullets was not the respondent but Mr Spizzirri alone, it was clearly vital, if the case against the respondent were to be made good, to show that s 8 of the Code, as read with s 2, rendered the respondent criminally liable for the "act or omission" involved in Mr Spizzirri's use of his firearm. To the extent that, instead, the trial judge told the jury that to establish such liability it was sufficient "that the unlawful purpose was to inflict some serious harm upon Coffey"37, his Honour diverted the jury's attention from the relevant "offence", as s 2 of the Code defines it. In the interpretation and application of a codified restatement of the law, it is essential to approach the problem in the foregoing way. The first loyalty is to the Code, understood according to its text38. General provisions of a code, such as the provisions of ss 2 and 8 of the Code applicable here, were intended to be understood and applied, according to their ordinary meaning. Thus, properly, the trial judge read those provisions to the jury. However, with respect, he then failed to explain to the jury the definition of "offence" provided by s 2 and its significance for the operation of s 8 in this case. Had he done so, this would have reminded the jury both of the obligation to start the inquiry about common purpose liability with an identification of the act or omission that was primarily relevant (here the act or omission involved in Mr Spizzirri discharging his 35 Quoted by Kiefel J at [106]. 36 [2007] QCA 440 at [21]. 37 Cited [2007] QCA 440 at [22] (emphasis in original). 38 Barlow (1997) 188 CLR 1 at 32; Jervis (1993) 1 Qd R 643 at 647. Kirby firearm at Mr Coffey). Doing this would have encouraged the trial judge to explain to the jury the purpose of s 8, read with s 2, which is (in the defined circumstances) to extend the liability of a person such as the respondent to liability for the "offence" (act or omission) done by another person. Conclusion: direction erroneous: Instead of following this course, as the language of the Code required, the trial judge bypassed the identification of the particular acts and omissions in question. Incorrectly, he focused the jury's attention on the suggested generic offence of unlawful purpose "to inflict some serious physical harm upon Mr Coffey". Respectfully, that was not the inquiry that the language of the Code required the jury to consider. The interpretation is decided by the majority in Barlow Obedience to the Court's authority: In recent years, this Court has repeatedly reminded judges at trial and intermediate courts of their duty to conform to the rulings of this Court in matters submitted to it for its decision39. It has instructed them to observe "seriously considered dicta uttered by a majority of this Court"40. Although, respectfully, I question whether the legal duty of obedience extends beyond obedience to the rationes decidendi of earlier decisions41, I certainly agree that, where such decisions exist, the legal principles for which they stand must be applied by judicial officers subject to this Court's authority as an aspect of the rule of obedience to the doctrine of judicial precedent that applies throughout the Judicature of this country. Contemporary questioning of Barlow: When in 1997 this Court heard the appeal in Barlow, it was required to resolve a challenge to a decision of the Court of Appeal of Queensland concerning a direction given to the jury in that case by the trial judge (who, by chance, was also the trial judge in the present case). After the decision of this Court in Barlow, the learned trial judge published a comment suggesting that the interpretation of s 8 of the Code, as previously accepted by the Court of Appeal, had been "tolerably clear" and that this Court had "gone to quite extraordinary lengths to secure a national uniformity of 39 Garcia v National Australia Bank Ltd (1998) 194 CLR 395 at 403 [17] per Gaudron, McHugh, Gummow and Hayne JJ; [1998] HCA 48. 40 Farah Constructions Pty Ltd v Say-dee Pty Ltd (2007) 230 CLR 89 at 159 [158]; [2007] HCA 22. 41 Garcia v National Australia Bank Ltd (1998) 194 CLR 395 at 420-421 [64] of my own reasons. Kirby approach … which should ordinarily have been considered by the legislature, not the court"42. In his article, the trial judge recognised that the issue for consideration in Barlow was the meaning of s 8 of the Code. He expressed his preference for the dissenting opinion in Barlow of McHugh J, who would have dismissed the appeal from the Court of Appeal's orders43. He favoured what he termed the "literalist" or "natural meaning" interpretation of s 8 rather than what he saw as an interpretation of s 8, preferred by the majority of this Court in Barlow, based on suggested policy grounds rather than textual analysis44. I mention this discourse only because there is more than a hint in the directions given by the trial judge in the present case of the approach that his Honour had advocated in his published comment that followed the decision in Barlow. Without descending into criticism (or worse), for I am not myself overly- sensitive to proper intellectual discourse on issues of broad legal controversy, it is certainly necessary, where an earlier holding of this Court resolves a legal issue, for this Court to insist that trial judges and intermediate courts give effect to the Court's rulings unless the earlier ruling is varied, distinguished or overridden by Parliament. This is what I take the Court of Appeal to have done in the reasons that sustained its conclusion, in the present case, that the trial judge's directions to the jury were erroneous, measured against the standard expressed by the majority of this Court in Barlow. Analysis of majority in Barlow: Let there be no doubt that the foundation for the Court of Appeal's present decision was its application of the ruling in Barlow. Thus, at the outset of its analysis, the Court of Appeal said45: "The High Court of Australia gave detailed consideration to the construction of s 8 in R v Barlow, ultimately concluding that s 8 did not preclude a secondary offender from conviction of manslaughter when the principal offender was convicted of murder." 42 de Jersey, "Murder, Manslaughter or Nothing: Delicious Irony, or, Will this Trial Judge Ever be Satisfied?", (1997) 71 Australian Law Journal 716 at 722. 43 (1997) 71 Australian Law Journal 716 at 720-722. 44 Reference was made to his Honour's dissenting reasons in R v Jervis [1993] 1 Qd R 643 approved in the Court of Appeal in Barlow sub nom Alexanderson (1996) 86 A Crim R 77 at 92, 98-99. See (1997) 71 Australian Law Journal 716 at 716, but disapproved by the majority in Barlow. 45 [2007] QCA 440 at [33] (citation omitted). Kirby Their Honours went on to extract five substantial passages from the reasoning of the majority in Barlow, namely four from the joint plurality reasons of Brennan CJ, Dawson and Toohey JJ46 and an extended quotation from my own reasons in that decision to like effect47. In the passages extracted from the joint reasons in Barlow, the point is made (repeating what is stated above) that48: "Section 2 of the Code makes it clear that 'offence' is used in the Code to denote the element of conduct (an act or omission) which, if accompanied by prescribed circumstances, or if causing a prescribed result or if engaged in with a prescribed state of mind, renders a person engaging in the conduct liable to punishment. Section 7(a) confirms that 'offence' is used to denote the element of conduct in that sense. By the ordinary rules of interpretation, the term must bear the same meaning in pars (b), (c) and (d) of s 7 as it bears in par (a). Section 8, which complements s 7 and extends the net of criminal liability for an offence to the parties who have formed a common intention of the kind therein mentioned, reveals no ground for attributing a different meaning to 'offence' in s 8." In a manner appropriate to the issue presented by the evidence at the respondent's trial, the Court of Appeal in the present case went on to quote from a later passage in the joint reasons in Barlow49: "'[O]ffence' in s 8 must be understood to refer to an act done or omission made. So interpreting the section, it deems a person falling within its terms to have done the act or to have made the omission which the principal offender has done or made. It fastens on the conduct of the principal offender, but it does not deem the secondary party to be liable to the same extent as the principal offender. It sheets home to the secondary offender such conduct (act or omission) of the principal offender as (1) renders the principal offender liable to punishment but (2) only to the extent that that conduct (the doing of the act or the making of the omission) was a probable consequence of prosecuting a common unlawful purpose. The secondary party is deemed to have done an act or made an 46 [2007] QCA 440 at [33]-[37] referring to Barlow (1997) 188 CLR 1 at 8-9, 10, 11, 47 [2007] QCA 440 at [38] citing Barlow (1997) 188 CLR 1 at 43-44. 48 (1997) 188 CLR 1 at 9. See also reasons of Kiefel J at [131]-[132]. 49 [2007] QCA 440 at [34] citing Barlow (1997) 188 CLR 1 at 10 (emphasis added). Kirby omission but only to the extent that the act was done or the omission was made in such circumstances or with such a result or with such a state of mind (which may include a specific intent) as was a probable consequence of prosecuting the common unlawful purpose. … Thus the unlawful striking of a blow by a principal offender will constitute an offence the nature of which depends on whether the blow causes bodily harm or grievous bodily harm or death and on the specific intent with which the blow is inflicted." I call particular attention to the emphasised passages from the joint reasons in Barlow. These make it clear beyond doubt that, reading s 8 of the Code in the light of s 2, takes the interpreter down the scale from a generic classification of the "offence" (that, in colloquial terms, might attribute a designated crime to all of the offenders) so as to focus attention, instead, on the particularity of the "conduct of the principal offender". Any doubt about what the joint reasons were intending is removed by the specific reference to "the unlawful striking of a blow". This is not the language of generic offences. Still less is it language that adopts a textual definition of an "offence" in the Code. It is (as s 2 requires of the application of s 8 of the Code) the language of the particular acts or omissions of the primary (or principal) offender which s 8 of the Code is being invoked to "sheet home" to the "secondary offender". Applying this approach to the present case, Barlow holds that the proper application of s 8 of the Code is to ask what the act or omission of the principal offender is. In this case, it was Mr Spizzirri whose shooting caused the profound injury to Mr Coffey. To render the respondent criminally responsible for Mr Spizzirri's "offence", so defined, in order that the respondent should be deemed to have committed the offence, demands that the following question be answered in the affirmative50: "Was the nature of the blow actually struck such that its infliction was a probable consequence of the prosecution of the relevant unlawful purpose?" The joint majority reasons in Barlow were thus sufficient to establish the binding rule established by that decision. Moreover, a passage cited by the Court 50 [2007] QCA 440 at [35] citing Barlow (1997) 188 CLR 1 at 10. See also reasons of Kirby of Appeal from my own reasons in Barlow endorses the same reasoning and puts the holding of this Court in that case beyond contest51: "This approach to the definition of 'offence' in s 8 of the Code is reinforced by reference to the definition of 'offence' in s 2. That section defines 'offence' in terms of the 'act or omission' of the accused. It does not do so in terms of the classification of the particular crime as appearing elsewhere in the Code. The definition of 'offence', when applied to s 8, therefore permits, if it does not compel, a differentiation between the acts and omissions respectively of the principal offender and of the common purpose co-offender. In the case of unlawful killing, the 'offence' which is committed by the principal is the act or omission constituting the unlawful killing referred to in s 300 of the Code." Instructed by these tolerably clear interpretations of s 8, read with s 2 and as explained in Barlow, the Court of Appeal in the present case concluded52: "The application of these observations in Barlow to the present case supports the appellant's contention to the extent that 'offence … of such a nature' in s 8 here refers to the act of intentionally shooting Coffey and so causing him grievous bodily harm, not merely (as the trial judge told the jury) the generic offence of intentionally doing Coffey grievous bodily harm." Conclusions: Court of Appeal correct: The Court of Appeal was correct in deriving the instruction that they did from Barlow. All of the participants in this Court's joint majority reasons in Barlow were greatly respected exponents of the criminal law. In particular, Brennan and Toohey JJ were each highly knowledgeable practitioners of the Griffith Code, applicable respectively in Queensland and Western Australia. No suggestion was made in the argument of this appeal that this Court should reconsider the correctness of its decision in Barlow. Various unconvincing attempts were made to distinguish the holding in Barlow from the circumstances of the present case. In my view it is indistinguishable. This Court should uphold the Court of Appeal's application of what it held in Barlow. Nothing has been shown to demonstrate that what was said there was wrong. On the contrary, it is anchored in the text. Contrary to the apparent belief expressed at the time by the trial judge, it applies the natural meaning of the section to a case such as the present, once it is appreciated that 51 Barlow (1997) 188 CLR 1 at 43-44, cited in [2007] QCA 440 at [38] (emphasis added). 52 [2007] QCA 440 at [39]. Kirby the word "offence" in s 8 of the Code must be understood with the particular meaning that is afforded by s 2. This Court's demands for obedience to its binding rulings on law should not be confined to rulings made in civil litigation or in much loved areas of commercial law. The rule applies equally when invoked in criminal trials by offenders such as the respondent. Judicial neutrality requires nothing less. Maintaining Barlow and common basic legal principles Upholding basic principles: Although the trial judge, in the article earlier cited53, was critical of what he described as the "extraordinary lengths" to which the majority of this Court had gone in Barlow "to secure a national uniformity of approach"54, with respect, that criticism is misplaced. To the extent that it influenced, however unconsciously, a reluctance on his Honour's part to apply the Barlow rule to the jury instructions in the present case, it led to the error exposed by the reasons of the Court of Appeal. It is well established by the authority of this Court that, at least in matters of basic legal principle, where there is an ambiguity in an Australian criminal code, such as the Code under consideration here, and where alternative constructions are arguable, this Court will ordinarily favour the meaning that achieves consistency in the interpretation of like provisions in the codes of the other Australian code jurisdictions55. Moreover, it is also well established that this Court will tend to favour an interpretation of the Code that achieves consistency as between the code jurisdictions and the expression of analogous general principles of the common law existing elsewhere in the nation. The explanation for such an approach scarcely needs elaboration or justification. It is no more than a proper contribution by this Court, where its analysis of the text permits, to the achievement of "a desirable uniformity in basic principles of the criminal law throughout Australia". As I further explained in Barlow56: 53 (1997) 71 Australian Law Journal 716 at 722. 54 cf Vallance v The Queen (1961) 108 CLR 56 at 75-76; [1961] HCA 42. 55 Zecevic v Director of Public Prosecutions (Vict) (1987) 162 CLR 645 at 665; [1987] HCA 26. 56 (1997) 188 CLR 1 at 32. Kirby "Variations in local opinion may result in divergencies in matters of detail in the criminal law. But in matters of general principle, it is highly desirable that unnecessary discrepancies be avoided or, at least, reduced." liability: Against Limiting accessorial these considerations of approach, it is important to realise that, both in this country and in others with similar principles of common intention liability, great care is generally taken to avoid the imposition by law of accessorial liability beyond limits that the judges deem tolerable to the community. Thus, in Darkan v The Queen, in an observation noted by the Court of Appeal in the current case57, the joint reasons of Gleeson CJ, Gummow, Heydon and Crennan JJ remarked58: the background of "Although the law has long recognised accessorial liability, it has also long attempted to lay down limits to the accessorial liability of a person who shared a common purpose with a wrongdoer, or who instigated a wrongdoer to commit a crime. The alleged accessory is not to be liable for everything a principal offender did, either vicariously or absolutely. Over time the law has employed different techniques for placing accessorial liability within just limits while continuing to give it substantial room for operation. The common law protects against excessively wide liability by demanding actual foresight, albeit of a possibility. Under ss 8 and 9 of the Code the function of protecting against excessively wide liability turns on the need for probability of outcome, independently of the alleged accessory's state of mind. If under ss 8 and 9 of the Code the expression 'a probable consequence' were construed so as to make a possible consequence sufficient, there would be liability in the accessory for whatever the principal offender did, since the fact that the principal offender did it shows that it was possible, and there would be no protection against excessively wide liability." For more than a century, similar concerns have influenced attempts by the courts to mark off the limits of common purpose liability that can be supported by proper legal principle. In a well known passage of his reasons in R v Anderson; R v Morris59, Lord Parker of Waddington CJ suggested that it would "revolt the conscience of people today" if a secondary offender were convicted of manslaughter in circumstances where the principal offender "has suddenly formed an intent to kill and has used a weapon and acted in a way which no party to [the] common design could suspect"60. 57 [2007] QCA 440 at [41]. 58 (2006) 227 CLR 373 at 397 [76]; [2006] HCA 34. 60 [1966] 2 QB 110 at 120. Kirby In Rahman61, several members of the House of Lords referred to the considerations recognised by Lord Parker CJ62. Lord Neuberger of Abbotsbury saw Lord Parker CJ's admonition as an adverse comment on Salisbury's case63. He did so in order to make the point that, at common law, an accessory secondary offender will not be held liable for every particular act or omission of the primary offender. The question of common law will always be whether such acts or omissions fell within the ambit of the "common intention" that was "understood and foreseen". Or whether the primary offender had "completely departed" from that understanding. The test of "complete departure" was expressed by Lord Parker CJ in Anderson and Morris64 in these terms: "It seems to this court that to say that adventurers are guilty of manslaughter when one of them has departed completely from the concerted action of the common design and has suddenly formed an intent to kill and has used a weapon and acted in a way which no party to that common design could suspect is something which would revolt the conscience of people today." Clearly, in a common law test expressed in such broad terms, there will be room for differences of opinion as to whether the standard of departing completely has, or has not, been met. The decision of the House of Lords in Rahman is replete with instances where such differences emerged on appeal. There are many more in the case law of Australia (as well as of Canada, New Zealand and other jurisdictions). A large number of decisions collected and analysed in Rahman involved cases where, by the introduction of a knife65 or any other weapon66, the principal 61 [2008] 3 WLR 264; [2008] 4 All ER 351. 62 [2008] 3 WLR 264 at 274 [20] per Lord Bingham of Cornhill, 285 [61] per Lord Brown of Eaton-under-Heywood, 293 [94] per Lord Neuberger of Abbotsbury; [2008] 4 All ER 351 at 361, 372, 379. 63 (1553) 1 Plow 100 [75 ER 158]. See [2008] 3 WLR 264 at 293 [94]; [2008] 4 All ER 351 at 379. 64 [1966] 2 QB 110 at 120 (emphasis added). 65 This was the case in Rahman. See [2008] 3 WLR 264 at 272-273 [18]; [2008] 4 All ER 351 at 360 citing the instruction to the jury of the trial judge in that case; cf R v Anderson; R v Morris [1966] 2 QB 110 at 113-114; R v Uddin [1999] QB 431. See also R v Powell [1999] 1 AC 1 at 25-26. Kirby offender "departed completely from the concerted action of the common design"67. Running through these cases, admittedly concerned with the principles of the common law, is the realisation that a limit has to be set for common purpose liability. Many of the cases cited indicate that the limit will be reached where the principal offender introduces a gun or a knife where this seriously escalates the level of risk of violence, the potential of serious injury and the nature of the peril inherent in the joint enterprise as initially conceived. It is true that baseball bats68, wooden posts69 and even a child's catapult70 can do serious harm to a victim. However, the introduction of knives and guns by the primary offender may be treated by a jury as involving "actions … of a type entirely different from actions which the others foresaw as part of the attack"71. At common law, the determinant is thus the accused's foresight of what a co-offender might do, "an issue to which knowledge of the associate's possession of an obviously lethal weapon such as a gun or a knife would usually be very relevant"72. Posing issues apt to jury verdicts: Conversely, if a jury concluded that the secondary offender was unaware that the primary offender had possession of a potentially lethal weapon, such as a gun or a knife, this could sustain a conclusion that the conduct executed by the primary offender was "in a different league to the kind of battering to which the attackers implicitly agreed upon by the use of those other weapons"73. Such a decision is properly one for the jury. But the point important for present purposes is that the law reserves such 66 See Chang [1985] AC 168 at 175. 67 Rahman [2008] 3 WLR 264 at 281 [44] per Lord Rodger of Earlsferry citing R v Anderson; R v Morris [1966] 2 QB 110 at 120; [2008] 4 All ER 351 at 368. 68 Rahman [2008] 3 WLR 264 at 278 [35] per Lord Rodger of Earlsferry; [2008] 4 All ER 351 at 366. 69 [2008] 3 WLR 264 at 269 [12] per Lord Bingham of Cornhill; [2008] 4 All ER 351 70 [2008] 3 WLR 264 at 275 [22]; [2008] 4 All ER 351 at 362. 71 R v Uddin [1999] QB 431 at 441. 72 Rahman [2008] 3 WLR 264 at 275-276 [24] per Lord Bingham of Cornhill; [2008] 4 All ER 351 at 363. 73 The directions to the jury of the trial judge in Rahman approved by Lord Bingham of Cornhill: [2008] 3 WLR 264 at 276 [26]; [2008] 4 All ER 351 at 363-364. Kirby considerations for a serious and real assessment by the jury. In doing so, the law leaves it "open to a jury to return a verdict which reflects the measure of the criminality of the accused as established by the evidence"74. The disadvantage of the directions given to the respondent's jury by the trial judge, now endorsed by a majority of this Court, is that they needlessly divorce the approach adopted to this fundamental question of the liability of common purpose offenders at common law and under the Code. By contrast, in requiring the jury to address their attention to the acts and omissions of the principal offender, the approach adopted in Barlow (and followed and applied by the Court of Appeal) permits a jury to consider the offence by the primary offender, as it was committed. It ensures consequent attention to the "nature" of the offence (as determined by the circumstances in which the "act" was done) the intention with which it was done, and its results. Uniformity in the Code and common law: Assuming that the ultimate purpose of the Code, in this respect, is the same as, or basically similar to, that of the relevant common law principle (viz to decide when a secondary offender will be criminally liable for the act or omission of the primary offender in the given circumstances) it would not be surprising if s 8 of the Code were to present the jury with questions the same as, or not dissimilar to, those that have to be answered in Australia's common law jurisdictions. On the face of things, in a matter so fundamental and basic to the liability of one person for the criminal conduct of another, it would be desirable for similar questions to be presented for jury verdicts throughout this country. And that they would be real questions obliging the jury to decide, by reference to the respective actions and omissions of the primary offender and the shared common purposes of the secondary offender(s), whether the latter were to be "deemed" to be liable for the criminal "offence(s)" of the former. If the question presented to the jury is expressed at the high level of generality ("generic") deployed by the trial judge and now endorsed by the majority of this Court, the kind of line-drawing found in the common law authorities will not arise. No issue will necessarily be presented as to whether the introduction of much more dangerous weapons (such as knives and guns) constituted a complete departure from the ambit of imputed liability under s 8. Liability will simply attach by reason of nothing more than the involvement by the secondary offender in an "offence" defined at a high, and virtually inescapable, level of generality, such as "to inflict some serious physical harm upon Mr Coffey". 74 Barlow (1997) 188 CLR 1 at 33 per my own reasons, citing Gilson v The Queen (1991) 172 CLR 353 at 365; [1991] HCA 24; Jervis [1993] 1 Qd R 643 at 665 and Hind and Harwood (1995) 80 A Crim R 105 at 135 per Fitzgerald P. Kirby Where, as Barlow shows, this is not a necessary interpretation of s 8 of the Code, the trend of common law principle applicable in those Australian jurisdictions where it is still relevant, affords an added reason of established legal doctrine, hitherto declared and applied by this Court, for maintaining the particularity of the Barlow comparator. Considerations of policy and principle support the Court of Appeal In Barlow75 I collected additional reasons of legal principle and policy for endorsing the approach favoured by the majority in that decision. On re-reading them, I still consider that they are relevant. They apply to the present case. They include: Reflecting community justice: Where there is any ambiguity in the Code it should be resolved in a way that will permit juries, without undue complexity, to distinguish between the criminal culpability of an accused secondary offender and the culpability of the primary offender. It is still true that most serious criminal trials in Australia are conducted before juries "whose function is to reflect, in a general way, the community's sense of justice"76. Reserving to the jury, by reference to the particular conduct (the act or omission amounting to an "offence" as defined) which, in effect, differentiates between the "nature" of the offence committed and that for which a common intention was formed, reserves to the jury a real, appropriate and proper function apt for their verdict. The "generic" approach favoured by the trial judge and now by a majority of this Court, effectively withholds from the jury a real, appropriate and proper role in setting the bounds of the notional criminal liability for which s 8 provides; Clarifying the jury's substantive role: Where the relevant determinant is the precise conduct of the primary offender (the "act or omission") this at least affords criteria of criminal liability susceptible to precise proof in the trial. This is a consideration relevant to a case where (as can sometimes happen) the offenders are tried separately. An interpretation of the Code that renders it more simple to apply in practice and more readily understandable to a jury in a substantial criminal trial such as this was, is one that is attractive in an area of the law already replete with subtleties and undue complexities; 75 (1997) 188 CLR 1 at 40-41. 76 (1997) 188 CLR 1 at 40. Kirby Individual liability in fluid criminality: In the nature of offences in which common purpose liability is typically alleged, co-offenders may sometimes have different intentions or no clearly formulated intention at all. The approach adopted by the Court of Appeal, following Barlow, is one that invites a differential assessment of the respective criminal culpability of the co-offenders. Because this accords with the ordinary sense of justice and rationality, as with the normal purposes of the criminal law77, it is one that should be preferred to an interpretation that risks drawing all participants in conduct of fluid criminality into an undifferentiated liability for what will often be a much more serious crime, conviction of which, upon the legal fiction provided by s 8 of the Code and so understood, will typically attract very heavy punishment78; and Sharpening fictions in serious culpability: Section 8 imports a fiction to the criminal law. This fact alone provides a reason for care in expanding its ambit. The section imposes upon one person liability for the criminal act or omission of another, although that person has not actually performed that act or omission and may not have intended, anticipated or expected them to happen. On the face of things, where such a notional liability with potentially drastic consequences is provided for by law, it should be reserved to cases where a jury's attention has been specifically addressed to the relationship between the respective actions or omissions of the primary and secondary offenders and whether such conduct was of such a nature that it falls within the common intention that all offenders (whether primary or secondary) earlier formed. Only by adopting this approach is the risk of unjust assignment of fictional liability to secondary offenders avoided, permitting juries to decide whether a person such as the respondent had formed a common intention that included, in its prosecution, a purpose to commit an offence of the same nature as that performed by the principal offender. Where the text of the Code; the authority of Barlow; the trend of analogous common law doctrine; and the applicable considerations of legal principle and policy support the Court of Appeal's decision, its approach should be preferred to that of the primary judge now endorsed by the majority in this Court. 77 cf R v Jervis [1993] 1 Qd R 643 cited in Barlow (1997) 188 CLR 1 at 40. 78 cf my own reasons in Clayton v The Queen (2006) 81 ALJR 439 at 446 [41]; 231 ALR 500 at 509; [2006] HCA 58. Kirby The approach that presents a triable jury issue Adopting the correct approach: To the extent that s 8 of the Code abstracts the "offence", to which it refers, to be understood at a high level of generality ("generic"), effectively it becomes self-referential. It removes from any real decision in the trial (usually by a jury) the proper consideration of whether the primary offender has departed completely from the concerted action envisaged in the prosecution of the common purpose of the offenders. Take the present case as an illustration. If the reference to "an offence" means no more than an offence of serious violence to Mr Coffey, the result is to deprive the relevant decision-maker (here the jury) of the function of deciding the boundary of the "common intention". Far from depriving the words "of such a nature" in s 8 of content, the approach favoured by the Court of Appeal (and I believe this Court's decision in Barlow) reserves an important decision to the decision-maker at trial. It requires that the boundary of notional criminal liability be fixed by reference to the "nature" of the "offence" (act or omission) which is "committed" by the primary offender. By reference to such "nature", the decision-maker must then compare the "offence" and its "nature" with the antecedent common intention of the participants. Typically, and in the present case, that presents a classic jury question. Supporting offences of same nature: So much can be illustrated by the evidence in the present case. In favour of a conclusion that the "nature" of the "offence", as committed by Mr Spizzirri (using a loaded gun to shoot Mr Coffey) was within the ambit of s 8 (read with s 2) are the following factual circumstances, in particular: It was the respondent who conceived and directed what was clearly an intentional violent physical attack on Mr Coffey; The respondent was the person with a strong motivation to organise, plan and control the attack because of Mr Coffey's presumed defiance in "double-crossing" him over the repayment of drug moneys; The respondent arguably had very serious violence in mind during the attack if the jury accepted that he had earlier threatened to "cave Coffey's skull in"; The respondent organised the three assailants, including Mr Spizzirri whose capacity for violence was known, and (if the jury accepted the evidence) the respondent knew that his own passenger was armed with a baseball bat, obviously an instrument capable, if deployed in a particular way, of inflicting very serious physical harm to Mr Coffey; and Kirby The respondent pre-planned the removal of Mr Coffey's van, arguably to hide evidence of the violence to Mr Coffey that he had planned out of vengeance and anger. Against offence of same nature: On the other hand, there were a number of evidentiary indicators that the acts or omissions of Mr Spizzirri in taking a sawn-off gun with him and then using it to shoot directly at Mr Coffey were unexpected to the respondent and the co-assailants and an offence of a "nature" that fell completely outside the common purpose intended by the respondent and the other participants in respect of the violence against Mr Coffey. This evidence included: The testimony of Mr Jupp (if accepted by the jury) that the respondent had earlier specifically described the purpose of the enterprise as being to "touch up" Mr Coffey, ie, to punch him and physically assault him but nothing more; (2) Arguably shooting directly at him, with obviously profound risks to his life and bodily well-being, was completely disproportionate to the sum at stake (between $6,000 and $7,000); The respondent and Mr Jupp were in a vehicle separate from Mr Spizzirri and Mr Jupp, at least, immediately recounted how he had reacted with shock and disbelief, once he became aware of the use by Mr Spizzirri of a firearm; (4) An arguable purpose of taking Mr Coffey's van was to sell it to recoup the misappropriated moneys after physically assaulting him, something not really feasible after Mr Coffey was shot; and The sudden abandonment of the removal of the van and the immediate departure of all of the assailants from the scene arguably suggested a realisation of the unanticipated gravity of Mr Spizzirri's actions whose "nature" had exceeded the common purpose of the joint enterprise79. It is true that the trial judge reminded the jury that there was no evidence that the respondent knew that Mr Spizzirri had a gun. It is also true that the trial judge alerted the jury to the possibility that "[i]n carrying a gun and contemplating firing it, Spizzirri may have independently thought he would depart from any common plan". However, this last-mentioned possibility was then trivialised and discounted by the trial judge's observations, that followed, to the effect that the "common plan" may "indeed have been pitched at a much 79 cf [2007] QCA 440 at [60]. Kirby lower level, for example, to give Coffey a good talking to, or perhaps a cuff over the ear or a slap in the face, or a punch in the chest, but nothing too serious". Result: a miscarriage of justice: The trial judge's directions to the jury did not require them to focus their attention upon the relevant legal question that s 8 of the Code obliged them to address. Specifically, it did not oblige them to consider the act or omission of Mr Spizzirri in shooting directly at Mr Coffey and then to ask whether the "offence", so executed, was of such a "nature" that its commission was within any pre-existing "common intention to prosecute an unlawful purpose", shared (relevantly) with the respondent. A jury, properly instructed on the legal requirements of s 8, might have concluded that Mr Spizzirri departed completely from the concerted action; that his act of shooting was an act of an entirely different type; that it was, in effect, "in a different league; or was "fundamentally different"80. And that this was confirmed by his omissions once he had unexpectedly introduced the gun into the fray, of using the gun to fire over his head or away from him or simply to confront him with the gun. Although no relevant objection was taken by trial counsel to the trial judge's instructions to the jury, as they were given, it has not been argued that this omission was deliberate or tactical or otherwise undeserving of relief. Nor is the present a case where, if the jury were misdirected as to the proper legal foundation for finding the respondent legally liable for the "offence" as performed by Mr Spizzirri, this Court could uphold the conviction on the basis of the "proviso"81. The consequence is that a miscarriage of justice has occurred82. Conclusion and orders The majority of this Court has adopted an interpretation of the Code contrary to the one that I prefer. On this basis, and accepting that there is an ambiguity, it is important to remember the cautionary words of Lord Macaulay, written some 150 years ago83: 80 See Rahman [2008] 3 WLR 264 at 272 [18]; [2008] 4 All ER 351 at 359 per Lord Bingham of Cornhill. 81 The Code, s 668E(1A). See Gilbert v The Queen (2000) 201 CLR 414; [2000] HCA 15; Festa v The Queen (2001) 208 CLR 593; [2001] HCA 72. 82 cf reasons of Hayne J at [91]. 83 Amirthalingam, "Clarifying Common Intention and Interpreting Section 34: Should There be a Threshold of Blameworthiness for the Death Penalty?" [2008] Singapore Journal of Legal Studies 435 at 435. Kirby "In criminal cases … we think that the accused party ought always to have the advantage of a doubt on a point of law, if doubt be entertained by the highest judicial authority, as well as a doubt on a matter of fact." Lord Macaulay was one of the drafters of the Indian Penal Code, later copied in many other countries of our legal tradition. He knew what he was talking about. Indeed, his draft was the inspiration for the Griffith Code and for the predecessors of the provisions in question in the present appeal. In the result, the Court of Appeal was correct to identify errors and legal inaccuracies in the directions given to the jury by the trial judge. However, that Court erred in deciding that the proper relief was the entry of a verdict of acquittal. The Court of Appeal ought to have ordered a new trial. To give effect to these conclusions, I favour the following orders. Appeal allowed. Set aside order 2 of the orders of the Court of Appeal of the Supreme Court of Queensland. In place of that order, order that a new trial of the respondent be had on counts 2 and 3 of the indictment. Hayne HAYNE J. I agree with Kiefel J that, for the reasons she gives, the appeal should be allowed and consequential orders made, setting aside the orders of the Court of Appeal of the Supreme Court of Queensland and in their place ordering that the appeal to that Court against conviction is dismissed. Because the application to the Court of Appeal for leave to appeal against sentence has not been determined, it will be necessary to remit the matter to that Court for its consideration of that application. The Court of Appeal concluded84 that in applying s 8 of the Criminal Code (Q) ("the Code") in this case, it was not sufficient to identify the offence committed by the person who shot the victim as inflicting grievous bodily harm with intent; it was necessary to identify the offence by reference to the offender's conduct of shooting the victim. It followed, so the Court of Appeal held85, that asking whether the offence that had been committed was an offence of such a nature that its commission was a probable consequence of the prosecution of the unlawful purpose required examination of whether the "act of shooting" was a probable consequence. Approaching the matter in this way elides two related but distinct questions. Section 8 deems those who form a common intention to prosecute an unlawful purpose to have committed an offence where "in the prosecution of such purpose an offence is committed of such a nature that its commission was a probable consequence of the prosecution of such purpose". If, as the Court of Appeal held, the offence that was committed in this case must be identified by reference to the conduct constituting the offence, the condition for the engagement of s 8 in this case can be rendered as follows. First, what was the common purpose? Secondly, was the shooting that happened an offence of such a nature that its commission was a probable consequence of the prosecution of the purpose? Both questions must be addressed. And s 8 is not to be read as requiring that the offence that was in fact committed (the shooting) was a probable consequence of the prosecution of the unlawful purpose. To do so would give no work to the expression "of such a nature". The Court of Appeal thus erred when it said86 that: 84 R v Keenan [2007] QCA 440 at [43]. 85 [2007] QCA 440 at [43]. 86 [2007] QCA 440 at [43]. Hayne "To convict [the respondent] under s 8, the jury had to be satisfied beyond reasonable doubt that he, and either or both [of the co-accused], formed a common intention to unlawfully cause [the victim] serious harm; and that [the shooter's] act of shooting resulting in grievous bodily harm was a probable consequence of the prosecution of their joint common intention." (emphasis added) The question is not whether the act of shooting that did occur was a probable consequence, it is whether the act of shooting was an offence of such a nature87 that its commission was a probable consequence. This latter question directs particular attention to what was the common intention. Was it, as the prosecution alleged, a common intention to inflict serious physical harm on the victim? The Court of Appeal held88 that because there was no evidence (presumably no direct evidence) in this case that a gun may be used, and no evidence that the common intention was to injure the victim by whatever means were available to the participants, the jury could not exclude the inference that the shooter was acting outside the common intention and, accordingly, the respondent could not be found guilty of the offence that was committed. But by contrast, the Court of Appeal noted89 that, if the victim had been beaten by the bat which the respondent knew was taken to the scene, s 8 "may well have extended [the respondent's] criminal liability for [the victim's] injuries". This posited difference in outcome could be supported only if the Court of Appeal treated the absence of evidence that the respondent knew that a gun was taken to the scene as determinative of what was the common intention: as an intention at most to administer a beating by use of the bat. But to identify the common intention in this way would focus only upon the means that were to be used to effect the unlawful purpose. Identifying the weapon that was to be used is at best an incomplete description of the purpose that the prosecution alleged the parties had in this case. That purpose was alleged90 to be the purpose of inflicting some serious physical harm on the victim. 87 R v Barlow (1997) 188 CLR 1 at 10; [1997] HCA 19. 88 [2007] QCA 440 at [56], [60]. 89 [2007] QCA 440 at [61]. 90 [2007] QCA 440 at [22]. Hayne It is important to recognise that the second question presented by s 8 – was the offence that was committed an offence of such a nature that its commission was a probable consequence of the prosecution of the unlawful purpose? – can be answered in the affirmative even if the possibility that the conduct actually committed would occur was not shown to have been adverted to by any participant in the common intention. So much follows from the fact that what is a "probable consequence" is to be determined objectively91. In considering that objective question it will always be necessary to pay very close attention to what is identified as having been the common intention to prosecute an unlawful purpose. But it is necessary to bear steadily in mind that formation of the common intention to prosecute an unlawful purpose may not have been accompanied by any consideration, let alone detailed consideration, of what was to be done, how it was to be done, and who was to do what to bring about the intended purpose. In such cases there will be no direct evidence that the parties to the common intention adverted to the possibility that an offence of the nature of the offence that was committed would be committed; there will be no evidence that the parties to the common intention were aware that commission of the crime that was committed was a probable consequence92. Yet as Gibbs J said in Stuart v The Queen93, "in fact the nature of the offence [may be] such that its commission was a probable consequence of the prosecution of the common unlawful purpose". Whether it was, is a question for the jury94. It is a question that in this case required examination of what inferences were to be drawn from the whole of the evidence. While it may be accepted that the evidence did not require the inference that the common intention was to inflict serious physical harm on the victim by whatever means seemed appropriate and were available, that inference was open and could be drawn beyond reasonable doubt. 91 Stuart v The Queen (1974) 134 CLR 426 at 442-443 per Gibbs J; [1974] HCA 54. 92 Stuart (1974) 134 CLR 426 at 442 per Gibbs J. 93 (1974) 134 CLR 426 at 442. 94 Stuart (1974) 134 CLR 426 at 442-443. Hayne The Court of Appeal recognised95 that the premise upon which s 8 is engaged is that s 7 of the Code does not apply, and the accused is not a principal offender within the meaning of the provisions of s 7. Thus the premise upon which it was alleged that s 8 was engaged in the present case was that the respondent was not a person who had done or omitted to do any act for the purpose of enabling or aiding the shooter to shoot the victim96, that the respondent had not aided the shooter in committing the offence97, and that the respondent had not counselled or procured the shooter to shoot the victim98. Yet the actual conclusions reached by the Court of Appeal were founded on the requirement for proof of matters which, if established, may well have brought the respondent within one or more of the identified categories of principal offender. In particular, the requirement99 that the shooting that actually occurred be a probable consequence of the prosecution of the unlawful purpose is a conclusion that appears to require proof that the respondent either counselled or procured the shooting or at least enabled or aided the shooting. To construe s 8 in this way would deny that it is an extension of criminal responsibility. The Court of Appeal erred in concluding that the trial judge had not sufficiently directed the jury on the issues that the jury had to decide at the respondent's trial in connection with the application of s 8 of the Code. It also erred in deciding that the evidence led at the respondent's trial could not support his conviction. As Kiefel J demonstrates, the real issues100 at the respondent's trial were whether there was a common intention and what was that intention. Whether the shooting of the victim was an offence of such a nature that its commission was a probable consequence of the prosecution of the unlawful purpose depended upon what that intention was. And the trial judge rightly told the jury to consider whether the shooter had acted "independently of and outside the common intent, or was [his carrying a gun his] reflection of a reasonable means of implementing" 95 [2007] QCA 440 at [44]. 96 s 7(1)(b). 97 s 7(1)(c). 98 s 7(1)(d). 99 [2007] QCA 440 at [43]. 100 Alford v Magee (1952) 85 CLR 437 at 466; [1952] HCA 3. Hayne the common intention. It was neither necessary nor appropriate for the trial judge in this case to do more101. 101 Alford v Magee (1952) 85 CLR 437 at 466; Azzopardi v The Queen (2001) 205 CLR 50 at 69 [49]; [2001] HCA 25. HEYDON J. I agree with the orders proposed by Kiefel J and with the reasons given for those orders by Kiefel J and Hayne J. Crennan CRENNAN J. I agree that the appeal should be allowed and that orders be made as proposed by Kiefel J for the reasons given by her Honour. I also agree with the additional reasons given by Hayne J. KIEFEL J. The respondent Francis Robert Keenan, together with Stephen Edward Booth and Dion Francis Spizzirri, was charged with attempting unlawfully to kill Darren Thomas Coffey and, alternatively, intending to and doing him grievous bodily harm. The jury found the respondent not guilty of attempted murder but guilty of unlawfully doing grievous bodily harm with intent. The prosecution case was that the three co-accused and one Jeramie Jupp were parties to a plan to do serious harm to Coffey, as revenge for a wrong he had done the respondent. In the course of the attack Coffey received bullet wounds to his spine which rendered him a paraplegic. Spizzirri was alleged to have been the person who fired the shots. There was no evidence that the use of a gun had been discussed by the three accused in connection with the proposed attack. There was evidence from which the jury could conclude that the respondent knew that one of the parties to the attack went armed with a baseball-type bat. There was evidence that the respondent was the instigator of the plan to attack Coffey. Coffey had collected some $6,000 or $7,000 on the respondent's behalf and failed to pay it to him. Prior to the attack upon him Coffey's girlfriend, the respondent's niece Vonda Muir, received inquiries from the respondent about the money and their whereabouts. He left text messages on her mobile telephone, in which he said that it was a small world and that he would find Coffey one day; and that "he was going to cave his [Coffey's] skull in…". The evidence as to what was said about the planned attack upon Coffey came from Jupp. The respondent came to know of the whereabouts of Coffey through information provided by Jupp to Spizzirri. Jupp then met with Spizzirri and directed him to a house property at Hope Island, in south-east Queensland, where he pointed out the van in which Coffey and Muir then lived. The respondent followed in his motor vehicle. The group drove down the street and discussed their course of action. The respondent had a passenger, the person whom Jupp later identified as Booth. The respondent proposed that he would drive back to the van and let his passenger out. That person would beat up Coffey. Spizzirri and Jupp were to wait further back and drive him away when he had finished. The passenger alighted from the respondent's vehicle carrying a wooden baseball-type bat and approached the van swinging it at Coffey, although Coffey was unable later to say whether the bat struck him. Five or six sounds, described respectively as "pops" or "cracking sounds" by Muir and Jupp, were heard. Coffey fell face down to the ground. The respondent and his passenger rushed back to their vehicle and quickly drove off. Jupp said that Spizzirri ran from behind the van, that they got into Spizzirri's car and drove off. Spizzirri was carrying a shortened rifle or gun. Someone in the respondent's vehicle threw the bat out of the window. A bat, which Jupp said resembled the one used by the respondent's passenger, was recovered by police. The Court of Appeal referred to it as a "less than full-sized wooden baseball bat but … well capable of being used effectively as a weapon to inflict serious injury."102 This is an accurate description of the bat produced on the hearing of this appeal. Under cross-examination, Jupp said that he understood there was going to be some physical violence, but he thought it was to be a "punch-up" or "fisticuffs". He had not heard mention of the use of a gun or a bat. He recalled hearing someone, he thought the respondent, saying that his passenger was to give Coffey a "touch-up". It had been intended that Jupp would drive Coffey's van from the scene. The respondent's co-accused were acquitted. Booth was found not guilty by the jury but they could not reach a verdict with respect to Spizzirri, who was retried and found not guilty on both counts. The case against Booth depended upon evidence identifying him as the respondent's passenger; that against Spizzirri required the acceptance of Jupp's evidence as well as that of other witnesses. These outcomes did not affect the case against the respondent, which did not depend upon the conviction of the principal offender, but upon proof of the doing of an act by that person by evidence admissible as against the respondent103. And it depended upon the extension of criminal responsibility for offences committed in the prosecution of a common unlawful purpose by s 8 of the Criminal Code (Q)104 ("the Code"). Section 8 Section 8 provides: "When 2 or more persons form a common intention to prosecute an unlawful purpose in conjunction with one another, and in the prosecution of such purpose an offence is committed of such a nature that its commission was a probable consequence of the prosecution of such purpose, each of them is deemed to have committed the offence." (In the Courts below "common plan", "the plan" and the "common intention" or "common intent" were used as shorthand expressions for the words in s 8, "a common intention to prosecute an unlawful purpose". In these reasons, for the most part, the expression "the common purpose" is used.) 102 R v Keenan [2007] QCA 440 at [16]. 103 R v Barlow (1997) 188 CLR 1 at 11 per Brennan CJ, Dawson and Toohey JJ; [1997] HCA 19, referring to Hui Chi-ming v The Queen [1992] 1 AC 34 at 42-43. 104 The Criminal Code is set out in Sched 1 to the Criminal Code Act 1899 (Q). Section 8 is preceded by s 7, which deals with persons who are deemed to be principal offenders. It includes "every person who actually does the act or makes the omission which constitutes the offence"105, and any person who does or omits to do an act for the purpose of enabling or aiding another to commit the offence106, who aids another in committing the offence107 and who counsels or procures another to commit the offence108. The purpose of s 8 is to extend the criminal responsibility of the parties to a common purpose to an offence other than that which was intended to be committed. The section limits the extension of that responsibility by requiring that the nature of the offence committed be such as to be a probable consequence of the common purpose. The test of probable consequence reflects the historical approach of the common law. The foundations for provisions such as s 8 may be traced to Sir Matthew Hale109 and reference to it is made in Foster's Crown Law110. Responsibility does not depend upon the foresight of the parties to the common purpose. Although the common law has come to embrace such a test, the test in s 8 is an objective one111. Section 10A(2) of the Code112 makes plain that criminal responsibility extends to any offence that is a probable consequence of the prosecution of the common purpose, regardless of what offence is proved against the principal offender. 105 Criminal Code, s 7(1)(a). 106 Criminal Code, s 7(1)(b). 107 Criminal Code, s 7(1)(c). 108 Criminal Code, s 7(1)(d). 109 Darkan v The Queen (2006) 227 CLR 373 at 383 [29] per Gleeson CJ, Gummow, Heydon and Crennan JJ; [2006] HCA 34, referring to Hale, Historia Placitorum Coronae (1736), vol 1 at 617. 110 Foster, A Report of Some Proceedings on the Commission for the Trial of the Rebels in the Year 1746, in the County of Surry; and of Other Crown Cases, 3rd ed 111 Stuart v The Queen (1974) 134 CLR 426 at 442 per Gibbs J, Menzies and Mason JJ agreeing; [1974] HCA 54. 112 Section 10A was inserted by the Criminal Law Amendment Act 1997 (Q), Act No 3 of 1997, which relevantly came into operation on 1 July 1997. The reasoning of the Court of Appeal The Court of Appeal (McMurdo P, Holmes JA and Atkinson J) set aside the conviction but did not order a retrial113. The Court entered a verdict of acquittal114 for the offence for which the respondent had been convicted and for the offence of grievous bodily harm simpliciter115. The Court held that a jury, properly instructed, could not have excluded an inference that Spizzirri was acting independently of the common planned intention with respect to the attack upon Coffey116. The use of the gun in the attack is central to the reasons of the Court. The offence, to which s 8 referred, was the shooting. The possession or use of a gun was considered to be a necessary component of the common purpose, if it was to be concluded that the shooting was a probable consequence of that purpose. It was not necessary for the Court to consider whether, in terms of the section, the offence committed was of such a nature as to be a probable consequence of the common purpose. On the approach the Court took, that test could not be satisfied by the prosecution. The trial judge initially directed the jury by reference to the terms of s 8. His Honour said that it was necessary for the members of the jury to be satisfied beyond reasonable doubt117: "(1) that there was a common intention to prosecute an unlawful plan. You must consider fully and in detail what was any unlawful purpose and what its prosecution was intended to involve; (2) that the offence of attempted murder, or alternatively doing grievous bodily harm with intent, was committed in the prosecution or carrying out of that purpose. You must consider carefully what was the nature of any actual crime committed; and (3) that any offence in fact committed was of such a nature that its commission was a probable consequence of the prosecution of that purpose." (emphasis as added by the Court of Appeal) 113 R v Keenan [2007] QCA 440. 114 Criminal Code, s 668E(1) and (2). 115 Criminal Code, s 320. 116 R v Keenan [2007] QCA 440 at [60]. 117 R v Keenan [2007] QCA 440 at [22]. The Court of Appeal held that the trial judge misdirected the jury as to the description of the "offence … of such a nature" for the purposes of s 8. It said that it was not the "generic offence" of doing grievous bodily harm with intent, as the trial judge had directed, but "the act which rendered Spizzirri liable to punishment, namely, discharging a bullet or bullets and so causing grievous bodily harm."118 This was said to follow from R v Barlow119 and other authorities120. It was the view of the Court that an ultimate inference of guilt required that the common purpose involve the possession or use of a gun in the attack or that it expressly permit those actions. At the conclusion of its reasons for making the orders for acquittal the Court said121: "The present case is distinguishable from Reg v Smith (Wesley)122 where the secondary offender knew that the principal offender, who stabbed the deceased, was carrying a knife. Had the grievous bodily harm in the present case been effected with a baseball bat rather than a gun, then s 8 may well have extended [the respondent's] criminal liability for Coffey's injuries …123. But that was not the evidence here." Such an approach explains why the Court of Appeal considered that the trial judge's invitation to the jury, to consider that the common purpose was "to visit a serious assault upon, to occasion some serious harm to Mr Coffey", was misleading. Moreover, the Court considered that there were two alternative inferences open to the jury, which were consistent with the respondent's innocence. The common intention could have been "merely to moderately assault Coffey"124. At the other end of the scale it might be inferred that it was intended that he be assaulted with the bat125. Critical to the Court's reasoning was that there was no plan for the attackers to possess or use a firearm and no 118 R v Keenan [2007] QCA 440 at [43]. 119 (1997) 188 CLR 1. 120 Referring to R v Brien and Paterson [1999] 1 Qd R 634; R v Johnston [2002] QCA 121 R v Keenan [2007] QCA 440 at [61]. 122 [1963] 1 WLR 1200; [1963] 3 All ER 597. 123 Referring to Varley v The Queen (1976) 51 ALJR 243; 12 ALR 347. 124 R v Keenan [2007] QCA 440 at [51]. 125 R v Keenan [2007] QCA 440 at [51]. evidence of a "broad plan to injure Coffey by whatever means any of the participants might find available or bring to hand"126. The trial judge had directed the jury in relation to those possible interpretations of the common purpose, and in some detail. The Court of Appeal held that the trial judge should have emphasised the competing inferences and given the direction referred to in Knight v The Queen127 – which the Court stated as being that "if two inferences are reasonably open, the jury can draw the guilty inference only if it is the only inference reasonably open"128. The Court of Appeal held that the misdirections resulted in a miscarriage of justice. When it came to consider whether a retrial should be ordered, the Court considered what may have been the common purpose and concluded that Spizzirri may have been acting outside it. This conclusion was seen as supported by the abandonment of a plan to remove Coffey's van129, presumably because that suggested that the shooting may have taken the other parties to the attack by surprise. Inherent in the Court's reasoning was the notion, earlier referred to, that the common purpose must incorporate, in some way, the use of a gun. The starting point in the reasoning of the Court was the two alternative inferences – that the plan may have been only to assault Coffey by the use of fists or that it involved the use of the bat. It followed, in the view of the Court, "that Spizzirri's use of the gun was entirely outside the unlawful common plan instigated by [the respondent]."130 The Court excluded the possibility that there had been a broader plan, one which permitted the participants to use means of their choice, on the basis that there was no evidence of such a plan131. The determination of what the common purpose was, and how that determination is reached, are matters for the jury132. If there had been a miscarriage of justice arising from misdirection, the Court should not have 126 R v Keenan [2007] QCA 440 at [60]. 127 (1992) 175 CLR 495; [1992] HCA 56. 128 R v Keenan [2007] QCA 440 at [51]. 129 R v Keenan [2007] QCA 440 at [60]. 130 R v Keenan [2007] QCA 440 at [60]. 131 R v Keenan [2007] QCA 440 at [60]. 132 Brennan v The King (1936) 55 CLR 253 at 261 per Starke J, 266 per Dixon and Evatt JJ; [1936] HCA 24. undertaken those tasks for itself and made the orders for acquittal. It ought to have ordered a retrial. It is necessary then to consider the directions given. The common purpose The approach taken by the Court of Appeal to a finding of common purpose was doubtless influenced by its view that the proper identification of the offence actually committed was the shooting which caused the grievous bodily harm. That factor informed its opinion of what was necessary for the plan to be carried out, if the respondent was to be held criminally responsible. In answering the questions, as to the nature of the offence committed and what was the common purpose, it is necessary to bear in mind how s 8 operates. The ultimate question which the section poses – whether the offence is of such a nature as to be a probable consequence of the common purpose – is directed to the connection between the offence and the common purpose. It is that connection which is the basis for criminal responsibility. The section's test for connection does not suggest as necessary an approach which imports the act involved in the offence into the finding of common purpose. The operation of an identical provision133 was described by Dixon and Evatt JJ in Brennan v The King in these terms134: "The expression 'offence … of such a nature that its commission was a probable consequence of the prosecution of such purpose' fixes on the purpose which there is a common intention to prosecute. It then takes the nature of the offence actually committed. It makes guilty complicity in that offence depend upon the connection between the prosecution of the purpose and the nature of the offence." The inferences available as to what the common purpose may have been in a given case will depend upon the evidence, viewed as a whole. Section 8 does not require the connection, between the offence actually committed and the common purpose to be prosecuted, to be established at the point when the common purpose is determined as a fact. It provides for the requisite connection to be determined by the application of the test, whether the offence was the probable consequence of the common purpose, after that purpose has been ascertained. 133 Section 8 of the Criminal Code (WA). 134 (1936) 55 CLR 253 at 263-264; and see Stuart v The Queen (1974) 134 CLR 426 at 442, 443 per Gibbs J; R v Jeffrey [2003] 2 Qd R 306 at 315 per McPherson JA. In some cases, where physical injury or death has resulted, the evidence may identify an unlawful purpose which involves the carrying out of a specific act. In Stuart v The Queen135 it was to light a fire in a nightclub, where persons would be present, in order to extort money from the operators of nightclubs in Brisbane. And the carrying out of an act, to cause physical injury, may be directed to a specific person. In R v Johnston136, to which the Court of Appeal directed attention in its reasons137, it was said138: "where there is a plan to do an act of a specific kind to a person, for example to assault him by punching him, an act of an entirely different kind, for example by shooting him, would not be an act of such a nature that its commission was a probable consequence of the prosecution of that plan." Davies JA went on to say139: "However here … the jury [was] entitled to infer that the common intention to which the appellant was a party was to do serious harm to [the victim] by whatever means seemed appropriate to ensure his silence". Similarly in Brennan140 and in Barlow141 it could be inferred that the plan involved the use of such violence as was necessary. In Brennan it was necessary that the caretaker be overpowered in order that the robbery succeed. The question which arose for the jury was "whether the death which ensued from the force employed can … be considered as a probable consequence"142 of the plan. Dixon and Evatt JJ held that it could, if the purpose in which the appellant concurred "made it likely that his confederates would, if necessary, use violence and such a kind or degree of violence as would probably cause death."143 135 (1974) 134 CLR 426. 136 [2002] QCA 74. 137 R v Keenan [2007] QCA 440 at [40]. 138 R v Johnston [2002] QCA 74 at [33] per Davies JA. 139 R v Johnston [2002] QCA 74 at [33]. 140 (1936) 55 CLR 253. 141 (1997) 188 CLR 1. 142 (1936) 55 CLR 253 at 264 per Dixon and Evatt JJ. 143 (1936) 55 CLR 253 at 264. It is not to be expected that every plan involving the infliction of physical harm will be detailed and include the means by which it is to be inflicted. However it may be possible to infer what level of harm is intended and from that point to determine whether the actual offence committed was a probable consequence of a purpose so described. An inference about the level of harm involved in the common purpose to be prosecuted may be drawn from the general terms in which an intended assault is described, the motive for the attack and the objective sought to be achieved, amongst other factors. Three cases usefully illustrate such an approach. In Varley v The Queen144 the intention, similar to that stated in the present case, was to beat or "rough up" the deceased. It was held that the plan involved such violence as might encompass the use of a baton or cosh by the police involved. In Johnston145, it was said that the jury could infer that the plan was to inflict serious harm upon the victim for two reasons: it was intended to punish him for threatening to go to the police and, more importantly, to ensure he did not do so. The inference was therefore possible that "a probable consequence of the prosecution of this plan would be that serious injury would be inflicted … by whatever means seemed appropriate to achieve those ends."146 Those means, it was held, included the use of a weapon such as a knife. And in R v Jeffrey147 it was decided to beat up the victim and then to do so again to prevent him remembering the first attack. It could therefore be inferred that an assault of sufficient seriousness was contemplated such that death was a probable consequence148. Where a method by which physical harm is to be inflicted has been discussed, or may be inferred as intended, it does not follow that the use of other means will prevent a person being held criminally responsible. In some cases the means intended to be used may permit an inference as to the level of harm intended. An offence involving such harm may be a probable consequence of such purpose whatever means came to be used. It may be otherwise where the intended means suggest no serious harm was intended and the offence committed well exceeds such a purpose. 144 (1976) 51 ALJR 243; 12 ALR 347. 145 [2002] QCA 74. 146 R v Johnston [2002] QCA 74 at [29] per Davies JA. 147 [2003] 2 Qd R 306. 148 R v Jeffrey [2003] 2 Qd R 306 at 318 per Davies JA. The author of Foster's Crown Law contemplated responsibility would follow149: that criminal "… if the principal in substance complieth with the temptation, varying only in circumstance of time or place, or in the manner of execution …". In Markby v The Queen150 and in Varley151 the use of the weapon in question was seen to be no more than an unexpected incident in carrying out the common purpose, even if its existence was not known to the secondary offender152. In the present case the trial judge was right to direct the jury to consider the common purpose for which the prosecution contended, namely that serious harm was to be visited upon Coffey. Such an inference could be drawn from the evidence identified by his Honour, particularly that concerning the respondent's motive for the attack, vengeance, and the inferences which might be drawn as to his level of hostility to Coffey because of Coffey's duplicity. Far from limiting the inference which might be drawn about common purpose, the evidence with respect to the use of the bat supported one of a general purpose, to inflict serious harm. There can be no doubt that such a weapon is capable of inflicting grievous bodily harm, even if a gun may do so more efficiently. It would be an odd result if the respondent could be criminally responsible for grievous bodily harm inflicted by means of a baseball-type bat but not by means of a gun, when the level of harm intended was achieved. There can be no difficulty, in a case such as the present, in describing the unlawful purpose as the infliction of serious physical harm. In such a case it is not correct to approach the determination of the common purpose by reference to the means and thereby determine the connection to which the objective test in s 8 is directed. Further, the test to be applied under s 8 is as to the probable consequences of the common plan, not what the parties might have foreseen. Even if the respondent had not anticipated that a gun might be used, he may nevertheless be held criminally responsible where it was used and caused the very level of harm that had been intended. In a case involving an objective of 149 Foster, A Report of Some Proceedings on the Commission for the Trial of the Rebels in the Year 1746, in the County of Surry; and of Other Crown Cases, 3rd ed (1809) at 369 and see R v Tyler and Price (1838) 8 C & P 616 [173 ER 643]. 150 (1978) 140 CLR 108; [1978] HCA 29. 151 (1976) 51 ALJR 243; 12 ALR 347. 152 Varley v The Queen (1976) 51 ALJR 243 at 246 per Barwick CJ, Stephen, Mason, Jacobs and Aickin JJ agreeing; 12 ALR 347 at 353; Markby v The Queen (1978) 140 CLR 108 at 112 per Gibbs ACJ. this kind the means actually used may not assume importance in the determination of probable consequence. Directions as to inferences A common purpose involving the use of the bat to assault Coffey is not different in nature from that of which the trial judge spoke, one to occasion Coffey serious harm. Such a purpose does not support a conclusion of the respondent's innocence of the offence of grievous bodily harm. An inference that something less than serious harm was intended might have qualified to support the respondent's innocence, but the drawing of such an inference required acceptance of part of Jupp's evidence and the rejection of other tenable evidence. A direction of the kind spoken of in Knight153 could not be seen as necessary in these circumstances. A direction such as that discussed in Knight154 is not required to be given in every case155. The direction, that a jury can only find, by inference, an element of the offence charged if there is no other inference favourable to the accused reasonably open on the facts, may be called for when the prosecution relies upon circumstantial evidence. But it is no more than the amplification of the rule that the prosecution must prove its case beyond reasonable doubt156. The trial judge directed the jury as to the burden of proof and the drawing of inferences. His Honour was not required to go further, having regard to the evidence. The evidence of Jupp, that something like the use of fists was all that was intended, had to be weighed against his evidence of the respondent's stated intention, that his passenger "beat up" Coffey, of the respondent's possible knowledge of the intended use of the bat, his motive of vengeance, his degree of hostility towards Coffey and his threats. If this evidence was accepted the jury could not conclude that anything less than serious harm was intended. The trial judge reminded the jury of Jupp's evidence and of the evidence to be weighed against it in reaching a conclusion as to what was intended. The 153 (1992) 175 CLR 495. 154 (1992) 175 CLR 495. 155 Shepherd v The Queen (1990) 170 CLR 573 at 578 per Dawson J; [1990] HCA 56. 156 Knight v The Queen (1992) 175 CLR 495 at 502 per Mason CJ, Dawson and Toohey JJ, referring inter alia to Peacock v The King (1911) 13 CLR 619 at 634; [1911] HCA 66; Plomp v The Queen (1963) 110 CLR 234 at 243, 252; [1963] HCA 44; Shepherd v The Queen (1990) 170 CLR 573 at 578. approach taken by his Honour is consistent with what was said in R v Hillier157, namely that a circumstantial case is not to be considered piecemeal158. It is of critical importance to recognise, in considering such a case, that "all of the circumstances established by the evidence are to be considered and weighed in deciding whether there is an inference consistent with innocence reasonably open on the evidence."159 There was another inference which the Court of Appeal considered should have been brought to the jury's attention. It concerned that part of the plan, of which Jupp spoke, which involved the removal of Coffey's van from the scene. The trial judge had suggested to the jury that the reason for such a plan was to effect the removal of evidence of the attack. The Court of Appeal considered that another inference, more favourable to the respondent, might be that it was intended to sell it to recoup the debt owed by Coffey to the respondent. The evidence as to this aspect of the plan was of marginal relevance at trial. It was not suggested by the Court of Appeal that any failure to mention such an inference could result in a miscarriage of justice. The only relevance of the plan to the reasoning of the Court was as to its abandonment. The Court considered that that fact supported an inference that the shooting was an act independent of the common plan, presumably because it suggested the shooting may have taken the other parties to the attack by surprise. It assumes no importance on this appeal. The nature of the offence Barlow160 was concerned with whether a verdict of manslaughter was possible against a secondary offender where a principal offender had been convicted of murder. If the "offence", to which s 8 refers, was limited to the offence as defined in the Code, the result would be that a person could avoid liability because the principal alone had intended to commit murder, but the person had been party to a plan to commit serious harm on the deceased161. 157 (2007) 228 CLR 618; [2007] HCA 13. 158 R v Hillier (2007) 228 CLR 618 at 638 [48] per Gummow, Hayne and Crennan JJ referring to Chamberlain v The Queen (No 2) (1984) 153 CLR 521 at 535 per Gibbs CJ and Mason J; [1984] HCA 7. 159 R v Hillier (2007) 228 CLR 618 at 637 [46] per Gummow, Hayne and Crennan JJ. 160 (1997) 188 CLR 1. 161 As observed in Barlow (1997) 188 CLR 1 at 10-11 per Brennan CJ, Dawson and A possible escape from the difficulty of the language of the section was identified by McPherson ACJ in R v Jervis162, namely to read the word "offence" in s 8 in light of the definition in s 2163. "Offence" is there defined as "an act or omission which renders the person doing the act or making the omission liable to punishment". Gibbs J in Stuart had remarked that, to expand s 8 by reading the definition of "offence" in s 2 into it, might obscure rather than illuminate its meaning, but as McPherson ACJ observed164, his Honour was speaking by reference to the facts of that case. The solution was applied by Brennan CJ, Dawson and Toohey JJ in Barlow where their Honours said165: "Section 2 of the Code makes it clear that 'offence' is used in the Code to denote the element of conduct (an act or omission) which, if accompanied by prescribed circumstances, or if causing a prescribed result or if engaged in with a prescribed state of mind, renders a person engaging in the conduct liable to punishment." Their Honours pointed out that the section does not refer to the jury's verdict against the principal offender, but their finding on the evidence against the secondary offender166. It is the conduct of the principal offender upon which s 8 fastens, the doing of the act or the making of the omission167. The circumstances of the offence, including its result and the state of mind which accompanied it define the offence as one of a particular "nature"168. Their Honours explained that the unlawful striking of a blow will constitute an offence, the nature of which depends upon whether the blow causes bodily harm or grievous bodily harm or death and upon the specific intent with which the blow is inflicted169. Applied to the facts of that case, and absent the intention to cause death or grievous bodily harm, the striking of the blow without justification or excuse and the resultant death rendered the principal offender liable to punishment for manslaughter. If the striking of the blow in those circumstances 162 [1993] 1 Qd R 643. 163 R v Jervis [1993] 1 Qd R 643 at 652. 164 R v Jervis [1993] 1 Qd R 643 at 653. 165 Barlow (1997) 188 CLR 1 at 9. 166 Barlow (1997) 188 CLR 1 at 8-9. 167 Barlow (1997) 188 CLR 1 at 10. 168 Barlow (1997) 188 CLR 1 at 10. 169 Barlow (1997) 188 CLR 1 at 10. and with that result were the probable consequence of the prosecution of the common purpose, s 8 would render Barlow liable for manslaughter. It is correct to say, following Barlow, that the shooting of the gun was the act constituting the offence, the "nature" of which is derived from the grievous bodily harm it caused and the intention with which it was inflicted. The task of the jury, presently under consideration, does not involve the question which arose in Barlow and the construction of the section to that end. The question the jury was to address was whether the shooting which caused the grievous bodily harm was an offence of such a nature that its commission was a probable consequence of the common purpose, such as they had found it to be. It was necessary that the jury understood that composite question170, the facts relevant to it and the relationship of those facts to such other in the application of the section's test. The task of the trial judge was to formulate the issues as questions of fact for the jury171. The shooting and the grievous bodily harm it caused were relevant facts and necessary to be considered in connection with the common purpose. The trial judge identified the nature of the offence as the doing of grievous bodily harm and identified the question posed by the section. His Honour told the jury that they must be satisfied beyond reasonable doubt that an offence of grievous bodily harm (or attempted murder) was committed in the prosecution of an unlawful common purpose. If they were, they then had to consider whether they were satisfied beyond reasonable doubt "that the nature of the offence committed was such that its commission was a probable consequence of the prosecution or furtherance or carrying out of the common unlawful purpose". His Honour then directed the jury as to the test of probable consequence and how it might be applied. His Honour did not advert to the fact of the shooting as the cause of the grievous bodily harm, but this would have been apparent to the jury. The Court of Appeal may have been concerned that if the offence was to be understood as involving the infliction of grievous bodily harm and the common purpose involved a similar objective, the jury might consider that it was obliged to conclude that that offence was a probable consequence of that plan. In such a situation the jury would have been so obliged. But such a conclusion would merely reflect the factual coincidence between offence and common purpose. That situation could only arise if the jury had found the common purpose to involve the infliction of such a level of physical harm. The means employed to achieve that level of harm, the shooting, does not assume 170 Alford v Magee (1952) 85 CLR 437 at 466 per Dixon, Williams, Webb, Fullagar and Kitto JJ; [1952] HCA 3. 171 Stevens v The Queen (2005) 227 CLR 319 at 327 [18] per Gleeson CJ and Heydon J; [2005] HCA 65. significance to such a finding. The absence of a direction that the shooting was the offence for the purposes of s 8 could not have affected the reasoning of the jury to a verdict. In these circumstances there was no miscarriage of justice172. The shooting was addressed by the trial judge at another point in the summing-up. An issue which had been raised by the defence was whether Spizzirri's possession and use of the gun could have reflected a misunderstanding of any plan, unreasonably went beyond its bounds or was a deliberate departure, on the part of Spizzirri, from it. The resolution of these questions was dependent upon the finding by the jury as to common purpose. The trial judge directed the jury's attention to these considerations. In so doing the shooting was identified as the relevant act to be considered in connection with the purpose. The alternative charge The Court of Appeal held that the charge of grievous bodily harm simpliciter ought to have been left to the jury173. The Court did not give detailed reasons for that opinion. It referred to the provisions which permit such a course174 and to the decision in R v Rehavi175. In that case the evidence of an intention to assault was equivocal, but the lesser charge was not put to the jury. The Court considered that there was a real risk that the jury, being persuaded that the appellant had inflicted serious injury, would infer intent rather than acquit him. A trial judge's duty to ensure a fair trial does not mean that the lesser charge must be left to a jury in every case. It is a question of what justice to the accused requires. Putting the lesser charge to a jury might jeopardise the accused's chance of a complete acquittal in some cases176. It could not be said that the evidence of intention was weak in the present case, having regard to the threats made by the respondent. The defence strategy was to suggest to the respondent's niece that they were not said in such a way, or in a context, which conveyed that they were made seriously. If the jury had 172 Dhanhoa v The Queen (2003) 217 CLR 1 at 14-15 [49] and 18 [60] per McHugh and Gummow JJ; [2003] HCA 40. 173 R v Keenan [2007] QCA 440 at [54]. 174 Criminal Code, ss 575, 579(2). 175 [1999] 2 Qd R 640. 176 R v Willersdorf [2001] QCA 183 at [20] per Thomas JA, McPherson JA and accepted this explanation the respondent may have been acquitted altogether, whereas he may well have been convicted of the lesser charge. The fact that the respondent's counsel did not seek to have the lesser charge put to the jury confirms that a forensic advantage was sought by its omission177. No miscarriage of justice can be said to have resulted. Summary A jury, properly instructed, was not obliged to conclude that the shooting was an act independent of the common purpose. Such a conclusion depended upon the jury's finding as to that purpose. It was not necessary to that finding that the jury determine whether the plan of attack included the possession or use of a gun. It was open to the jury to conclude that the common purpose was to inflict serious physical harm upon Coffey and the trial judge was correct to direct the jury's attention to this inference. The means to be used in the prosecution of that purpose do not assume significance. No further direction was required as to other possible inferences beyond those that were given. A trial judge should identify the offence and its nature for the jury, in connection with the ultimate question posed by s 8. However in this case no miscarriage of justice resulted from the trial judge not mentioning the shooting at this point. Orders The appeal should be allowed and the orders of the Court of Appeal of Queensland set aside. In lieu thereof it should be ordered that the appeal against conviction to that Court be dismissed. The matter should be remitted to that Court to determine the application for leave to appeal against sentence. 177 See Harwood v The Queen (2002) 188 ALR 296 at 300 [16]; [2002] HCA 20.

HIGH COURT OF AUSTRALIA THE STATE OF TASMANIA APPELLANT AND WEST COAST COUNCIL RESPONDENT Coverdale v West Coast Council [2016] HCA 15 14 April 2016 ORDER Appeal dismissed. On appeal from the Supreme Court of Tasmania Representation M E O'Farrell SC, Solicitor-General of the State of Tasmania with S K Kay for the appellant (instructed by Acting Director of Public Prosecutions (Tas)) Submitting appearance for the respondent S B McElwaine SC with R L A Munnings for the Attorney-General of the State of Tasmania, as contradictor (instructed by Crown Law (Tas)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Coverdale v West Coast Council Statutes – Interpretation – Meaning of "land" – Meaning of "Crown lands" – Whether "Crown lands" in s 11(1) of Valuation of Land Act 2001 (Tas) includes seabed and waters above it – Whether s 11(1) of Valuation of Land Act and s 2 of Crown Lands Act 1976 (Tas) in pari materia. Words and phrases – "Crown lands", "in pari materia", "including", "land". Acts Interpretation Act 1931 (Tas), s 46. Crown Lands Act 1976 (Tas), ss 2, 29. Local Government Act 1993 (Tas), Pt 9, s 87(1). Valuation of Land Act 2001 (Tas), ss 3, 11. FRENCH CJ, KIEFEL, KEANE, NETTLE AND GORDON JJ. This is an appeal from a judgment of the Full Court of the Supreme Court of Tasmania. The question is whether the seabed and waters of Macquarie Harbour are lands or Crown lands within the meaning of s 11(1) of the Valuation of Land Act 2001 (Tas) ("the VLA"). For the reasons which follow, that question should be answered, yes. The facts The respondent ("the Council") seeks to levy rates on eight marine farming leases over parts of the seabed and waters within Macquarie Harbour on the west coast of Tasmania pursuant to Pt 9 of the Local Government Act 1993 (Tas) ("the LGA"). To that end, it requested the appellant ("the Valuer-General") to value the leases in accordance with s 11(1) of the VLA. In substance, s 11(1) of the VLA provides that the Valuer-General must value all lands within each valuation district, including any Crown lands that are liable to be rated in accordance with Pt 9 of the LGA. The Valuer-General declined to value the leases on the basis that, in the Valuer-General's opinion, the leases are not over "lands" or "Crown lands that are liable to be rated" within the meaning of s 11(1). The Council instituted proceedings in the Supreme Court of Tasmania for, among other relief, a declaration that the Valuer-General was obliged to value the leases. At first instance, Blow CJ held that the leases were not over lands within the meaning of s 11(1) of the VLA and, therefore, were not liable to be rated1. On appeal to the Full Court, Tennent and Estcourt JJ (Pearce J dissenting) held that the leases were over Crown lands that were liable to be rated in accordance with Pt 9 of the LGA2. The present appeal is brought pursuant to a grant of special leave made on 11 September 20153. The Council did not appear at the special leave application or on the hearing of this appeal. Pursuant to the condition upon which special leave to appeal was granted, the Attorney-General of the State of Tasmania appeared by Senior Counsel as contradictor. 1 West Coast Council v Coverdale (2014) 203 LGERA 296. 2 West Coast Council v Coverdale (No 2) (2015) 325 ALR 751. [2015] HCATrans 228 (Kiefel and Nettle JJ). Nettle Gordon Relevant legislation Valuation of Land Act The Valuer-General has responsibility under s 5(2) of the VLA for the direction, control and management of the valuation of land in accordance with the VLA. Section 5(3) of the VLA provides that, without limiting those responsibilities, the Valuer-General's functions are, inter alia, to establish and maintain valuation rolls and enter valuations in the valuation rolls. So far as is relevant, s 11 of the VLA prescribes the duty of the Valuer- General to make valuations of land as follows: "(1) The Valuer-General must, subject to this section, make valuations of the land values, capital values and assessed annual values of all lands within each valuation district, including any Crown lands that are liable to be rated in accordance with Part 9 of the Local Government Act 1993. (1A) The Valuer-General may exempt land from the valuations to be made under subsection (1) if the Valuer-General considers that the land should not be included in those valuations." Section 3 of the VLA defines "land" as including: "(a) messuages, tenements and hereditaments, and incorporeal, of every kind and description (whatever may be the estate or interest in them), together with all structures, paths, passages, ways, waters, watercourses, liberties, privileges, easements, plantations, gardens, mines, minerals and quarries and all trees and timber on land or lying or being under land; and corporeal any structure which is above land but permanently anchored to, or otherwise kept in place above, the land; and a licence to enter or remain on land". Nettle Gordon The VLA defines "valuation district" as "the municipal area of a council"4. That definition impliedly incorporates the municipal areas of a council as prescribed by s 16 of the LGA. Section 16 provides: "(1) The State is divided into municipal areas. (2) A municipal area is an area specified in Column 1 of Schedule 3. (3) A municipal area includes – any accretion from the sea adjoining it; and any part of the sea-shore to the low-water mark adjoining it. (5B) Each municipal area is defined by reference to the relevant plan or plans specified in Column 1 of Schedule 3." The boundaries of most municipal areas (and, therefore, "valuation districts") are so drawn as to exclude the sea5. Macquarie Harbour is, however, almost completely inland, with only a narrow opening to the sea, and the boundaries of the Council's municipal area are so drawn that Macquarie Harbour, including the opening to the sea, is within the Council's municipal area. Crown Lands Act "Crown land" is defined in s 2 of the Crown Lands Act 1976 (Tas) ("the CLA"). Section 2 provides that in the CLA, unless the contrary intention appears: "Crown land means land which is vested in the Crown, and which is not contracted to be granted in fee simple; and includes land granted in fee simple which has revested in the Crown by way of purchase or otherwise". 4 VLA, s 3. 5 LGA, Sched 3. Nettle Gordon Unlike in the VLA, "land" is expressly defined in the CLA to include the sea. It provides6: "land includes land covered by the sea or other waters, and the part of the sea or those waters covering that land". It was accepted that Macquarie Harbour is vested in the Crown in right of the State of Tasmania and that it is "Crown land" within the meaning of the CLA. Local Government Act Part 9 of the LGA, which is referred to in s 11(1) of the VLA, is directed to rates and charges that may be imposed by councils. In Pt 9, s 87(1) specifies that: "All land is rateable except that the following are exempt from general and separate rates, averaged area rates, and any rate collected under section 88 or 97: land owned and occupied exclusively by the Commonwealth; land held or owned by the Crown that – is a national park, within the meaning of the Nature Conservation Act 2002; or is a conservation area, within the meaning of the Nature Conservation Act 2002; or (iii) is a nature recreation area, within the meaning of the Nature Conservation Act 2002; or is a nature reserve, within the meaning of the Nature Conservation Act 2002; or is a regional reserve, within the meaning of the Nature Conservation Act 2002; or 6 CLA, s 2. Nettle Gordon is a State reserve, within the meaning of the Nature Conservation Act 2002; or (vii) is a game reserve, within the meaning of the Nature Conservation Act 2002; or (viii) is a forest reserve, within the meaning of the Forestry Act is a public reserve, within the meaning of the Crown Lands Act 1976; or is a public park used for recreational purposes and for which free public access is normally provided; or is a road, within the meaning of the Roads and Jetties Act (xii) is a way, within the meaning of the Local Government (Highways) Act 1982; or (xiii) is a marine facility, within the meaning of the Marine and Safety Authority Act 1997; or (xiv) supports a running line and siding within the meaning of the Rail Safety National Law (Tasmania) Act 2012; land owned by the Hydro-Electric Corporation or land owned by a subsidiary, within the meaning of the Government Business Enterprises Act 1995, of the Hydro-Electric Corporation on which assets or operations relating to electricity infrastructure, within the meaning of the Hydro-Electric Corporation Act 1995, other than wind-power developments, are located; land or part of land owned and occupied exclusively for charitable purposes; (da) Aboriginal land, within the meaning of the Aboriginal Lands Act 1995, which is used principally for Aboriginal cultural purposes; land or part of land owned and occupied exclusively by a council." Nettle Gordon It is to be noted that none of the exemptions to land that is rateable in s 87(1)(b) of the LGA applies to marine farming leases granted pursuant to the Marine Farming Planning Act 1995 (Tas). It should also be noted that s 86 of the LGA contains a definition of "land" for the purposes of Pt 9: "land means a parcel of land which is shown as being separately valued in the valuation list prepared under the Valuation of Land Act 2001". As that definition requires the relevant land to have been valued under the VLA, it begs the question presented in this appeal. Acts Interpretation Act The Acts Interpretation Act 1931 (Tas) also contains a definition of "land". Section 46 of that Act provides that "land" includes "messuages, tenements, and hereditaments, houses, and buildings of any tenure and any estate or interest therein". That definition applies to every Tasmanian Act except where otherwise expressly provided in an Act or where the provision or its interpretation would be inconsistent with or repugnant to the true intent and object or the context of a particular Act7. "Crown lands" In view of the foregoing legislative provisions, this appeal turns on whether the meaning of "Crown lands" in s 11(1) of the VLA is restricted by what is said to be the ordinary signification of "land", and as such excludes the seabed and waters above it, or whether "Crown lands" in s 11(1) means "Crown land" as defined in the CLA, and hence "includes land covered by the sea or other waters, and the part of the sea or those other waters covering that land"8. The ordinary signification of "land" The Valuer-General contended that the inclusive definitions of "land" in the VLA and the Acts Interpretation Act extended the meaning of "land" but not 7 Acts Interpretation Act, s 4(1). 8 CLA, s 2. Nettle Gordon so as to exceed the ordinary signification of "land", which would not include the seabed or waters above it. In Risk v Northern Territory9, Gleeson CJ, Gaudron, Kirby and Hayne JJ doubted that the word "land" would ordinarily be understood as encompassing the seabed. But, as their Honours appreciated, as with the meaning of any word, the meaning of "land" depends on the context and purpose of the legislation in which it appears. Risk was concerned with "land" in the context of an Aboriginal land rights claim and, in that context, there were powerful textual and extrinsic indications that the phrase "land in the Northern Territory" in s 3(1) of the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) did not include the seabed below the low water mark of bays and gulfs within the limits of the Territory. By contrast, Goldsworthy Mining Ltd v Federal Commissioner of Taxation10 was concerned with the deductibility of expenditure incurred in dredging the seabed under a lease of the seabed; and, in that context, Mason J observed that, although the seabed may not answer the description of "land" in every sense, in general "land" in its legal signification includes "any ground, soil or earth". His Honour held that the long history of leases for mining purposes of strata of land under the sea supported the view that a lease of a portion of the seabed is ordinarily regarded as a lease of "land" within the general acceptation of that expression11. Mason J also remarked that a definition of "land" similar to that which appears in s 46 of the Acts Interpretation Act was sufficiently wide and general to enable it to comprehend a part of the seabed12. In Dampier Mining Co Ltd v Federal Commissioner of Taxation13, Mason and Wilson JJ noted, in a similar context, that it was in one sense "somewhat (2002) 210 CLR 392 at 403-404 [26]; [2002] HCA 23; see also Northern Territory v Arnhem Land Aboriginal Land Trust (2008) 236 CLR 24 at 65 [56] per Gleeson CJ, Gummow, Hayne and Crennan JJ; [2008] HCA 29. 10 (1973) 128 CLR 199 at 210; [1973] HCA 7. 11 Goldsworthy Mining (1973) 128 CLR 199 at 210-211. 12 Goldsworthy Mining (1973) 128 CLR 199 at 215; cf Risk (2002) 210 CLR 392 at 418 [82] per Gummow J, 435 [121] per Callinan J. 13 (1981) 147 CLR 408 at 428; [1981] HCA 29. Nettle Gordon artificial" to speak of the seabed as "land". But, even then, there was no suggestion in Dampier that a lease of the seabed was not a lease of land for the purposes of the relevant legislation14. Ultimately, therefore, as Gummow J observed in Risk, the question of whether the seabed and waters above it are "land" in the context of particular legislation must be resolved by "regard to the text of the statute as a whole, and the subject, scope and purpose of the statute and against the legislative history and antecedent circumstances"15. Constructional choice By and large, Tasmanian Acts define "Crown land" in one of three ways. Some refer to Crown land without defining it but implying that it has the same meaning as in the CLA16. A second group expressly provide that "Crown land" has the same meaning as in the CLA17. The third group expressly define "Crown land" for the purposes of the particular legislation18. 14 (1981) 147 CLR 408 at 428. 15 (2002) 210 CLR 392 at 418 [83]; see also at 435 [123] per Callinan J. 16 See, eg, Boundary Fences Act 1908 (Tas), s 4, definition of "owner"; Highways Act 1951 (Tas), s 3; Limitation Act 1974 (Tas), s 10; Fire Service Act 1979 (Tas), ss 57, 59, 66; Land Titles Act 1980 (Tas), ss 11, 19, 27; Forest Practices Act 1985 (Tas), s 44; Port Arthur Historic Site Management Authority Act 1987 (Tas), s 3(1), reserve"; Public Land definitions of "adjacent area" and "pre-existing (Administration and Forests) Act 1991 (Tas), s 135, definition of "World Heritage Area"; Wellington Park Act 1993 (Tas), ss 3(1), definition of "private right", 7(1), (2), 73; Private Forests Act 1994 (Tas), s 3, definition of "private commercial forest"; Aboriginal Lands Act 1995 (Tas), s 27(6); Land Tax Act 2000 (Tas), s 17; Meander Dam Project Act 2003 (Tas), s 8; Litter Act 2007 (Tas), s 4; Macquarie Point Development Corporation Act 2012 (Tas), ss 3(1), definition of "site", 53, 54; Workplaces (Protection from Protesters) Act 2014 (Tas), s 3, definition of "owner". 17 See, eg, War Service Land Settlement Act 1950 (Tas), s 3, definition of "Crown land"; Closer Settlement Act 1957 (Tas), s 3, definition of "Crown land"; Mining (Strategic Prospectivity Zones) Act 1993 (Tas), s 7(1), definition of "Crown land"; Electricity Companies Act 1997 (Tas), s 3, definition of "property"; Vermin Control Act 2000 (Tas), s 3, definition of "Crown land"; Evidence Act 2001 (Tas), s 177D(1); Forest Management Act 2013 (Tas), s 3, definition of "Crown land"; (Footnote continues on next page) Nettle Gordon In this case, the text of the VLA yields a constructional choice between a meaning of s 11(1) which embraces the definition of "Crown land" in the CLA, and so includes the seabed and waters above it, and a meaning which excludes them. Specifically, the word "including" in s 11(1) of the VLA is ambiguous. It is not clear from the text whether it is used in the phrase "all lands ... including any Crown lands" in a sense which restricts the definition of "Crown lands" to mean only those that fall within the ordinary signification of "land" or in a sense which extends the definition of "land" to Crown lands that fall outside of the ordinary signification of "land". Viewed, however, against the background of the VLA's legislative history and antecedent circumstances, the scope and purpose of the VLA dictate a constructional choice in favour of the adoption of the definition of "Crown land" in the CLA, which includes the seabed and waters above it. Legislative history of the LGA and the VLA Historical land rating legislation Early Tasmanian land rating statutes contained a general exemption from rates for land held by the Crown. Then, over time certain exceptions to the general exemption from rates for Crown land were introduced. From 1985, however, the approach became that all Crown land was liable to be rated subject only to a number of specific public purpose exemptions. Forestry (Rebuilding the Forest Industry) Act 2014 (Tas), s 3, definition of "Crown land"; Launceston Flood Risk Management Act 2015 (Tas), s 3, definition of "Crown land". 18 See, eg, Local Government (Highways) Act 1982 (Tas), s 3(1), definition of "Crown land"; Mineral Resources Development Act 1995 (Tas), s 3, definition of "Crown land"; Threatened Species Protection Act 1995 (Tas), s 3(1), definition of "Crown land"; National Parks and Reserves Management Act 2002 (Tas), s 3(1), definition of "Crown land"; Nature Conservation Act 2002 (Tas), s 3(1), definition of "Crown land". Nettle Gordon The earliest rating statutes empowered the municipal councils of Hobart19 and Launceston20, and later also the councils of other areas21, to levy rates upon the occupiers of assessed lands and buildings but stipulated that the power to rate did not extend to lands or buildings the property of, or occupied on behalf of, Her Majesty22. In broad terms, that approach was maintained in subsequent enactments23. In 1962, all provisions directed the rating functions of all municipalities, including Hobart and Launceston, were consolidated in the Local Government Act 1962 (Tas) ("the LGA 1962")24. At that stage, municipalities remained unable to rate land of Her Majesty or the Commonwealth25. In 1985, the rating provisions in the LGA 1962 were repealed and substituted26. So far as is relevant, the amended Act had the effect that all land in 19 Hobart Town Corporation Act 1857 (Tas) (21 Vict No 14), ss 97, 104. 20 Launceston Corporation Act 1858 (Tas) (22 Vict No 12), ss 97, 104. 21 Rural Municipalities Act 1865 (Tas) (29 Vict No 8), ss 119, 136. 22 Buildings held by the Government for public purposes and other properties used for public purposes including hospitals, benevolent asylums, buildings for charitable purposes, churches and chapels were also exempted: Hobart Town Corporation Act 1857 (Tas) (21 Vict No 14), s 104; Launceston Corporation Act 1858 (Tas) (22 Vict No 12), s 104; Rural Municipalities Act 1865 (Tas) (29 Vict No 8), s 136. 23 Hobart Corporation Act 1893 (Tas) (57 Vict No 11), ss 103, 116; Launceston Corporation Act 1894 (Tas) (58 Vict No 30), ss 115, 122; Local Government Act 1906 (Tas), ss 159, 173; Hobart Corporation Act 1929 (Tas), ss 105, 122; Launceston Corporation Act 1941 (Tas), ss 106, 115; Hobart Corporation Act 1947 (Tas), ss 101, 106. 24 LGA 1962, ss 2(1)(d), 5. Other valuation provisions also applied to Hobart and Hobart Corporation Act 1963 (Tas), ss 85-88; Launceston Corporation Act 1963 (Tas), ss 90-100. 25 LGA 1962, s 243(1)(a); see also par (b), which also created an exemption from rates for "land occupied exclusively for public or charitable purposes". 26 Local Government Amendment (Rates and Charges) Act 1985 (Tas), s 6. Nettle Gordon the valuation district became rateable including Crown land except land that was "owned by the Crown ... which is unoccupied or occupied exclusively for public purposes"27. Henceforth, there was no general exemption from rates for land owned by the Crown. In 1994, the LGA 1962 was repealed and replaced by the LGA28. As enacted, s 87(1) of the LGA provided that "[a]ll land is rateable" except, relevantly: land owned by the Crown which is unoccupied or occupied exclusively for public purposes (other than under the Homes Act In 2003, s 87 of the LGA was amended by the State and Local Government Financial Reform Act 2003 (Tas) ("the Financial Reform Act") whereby the rating provisions of the LGA assumed a form close to that in which they now appear29. Importantly, the evident object and effect of that alteration was to revoke the general exemption applicable to Crown land which was unoccupied or occupied exclusively for public purposes and to subject all Crown land to liability to being rated subject only to a number of specific public purpose exemptions. Historical land valuation legislation Likewise, while early valuation statutes contained a general exemption from valuing Crown land, over time the general exemption was replaced with provisions which required all Crown land to be valued subject only to a number of specific public purpose exemptions. The first separate land valuation statute was the Property Valuation Act 1857 (Tas)30. That Act and subsequent separate valuation statutes from the 27 LGA 1962, ss 232, 243(1) (as amended by the Local Government Amendment (Rates and Charges) Act 1985 (Tas)). Land owned by the Commonwealth or owned and occupied exclusively for public or charitable purposes was also exempted from rates and charges. 28 LGA, s 350, Sched 9. 29 Financial Reform Act, s 11. 30 21 Vict No 19. Nettle Gordon middle of the 19th century to the middle of the 20th31 made only limited reference to Crown land, no doubt because land of Her Majesty was exempt from liability to be rated32. Beginning with the Land Valuation Act 1950 (Tas), and subsequently the 1971 iteration of that Act33 ("the LVA 1971"), the Chief Valuer and the Valuer- General respectively were required to make a valuation of "all lands (other than Crown lands) within each valuation district, and of such Crown lands within each valuation district as the [Chief Valuer or Valuer-General] thinks proper to include in the valuation"34. Like the current legislation, those Acts did not contain a definition of "Crown lands". Until the LVA 1971 was repealed and replaced by the VLA in 200135, the duty in s 12 remained largely as just described, subject only to certain irrelevant amendments36. As first enacted, s 11(1) of the VLA had a similar structure and effect to s 12(1) of the LVA 1971 prior to its repeal. Once again, there was no definition of "Crown lands". In 2003, the Financial Reform Act, which also amended the LGA37, substituted s 11(1) as follows38: 31 Assessment Act 1900 (Tas) (64 Vict No 4); Land Valuation Act 1909 (Tas); Annual Values Assessment Act 1911 (Tas). 32 See above at [25]. Cf Property Valuation Act 1857 (Tas) (21 Vict No 19), s 35; Assessment Act 1900 (Tas) (64 Vict No 4), s 4, definition of "Annual value"; Land Valuation Act 1909 (Tas), s 2, definition of "Improvements"; Annual Values Assessment Act 1911 (Tas), s 6, definition of "Annual value". 33 Land Valuation Act 1971 (Tas). 34 Land Valuation Act 1950 (Tas), s 14; LVA 1971, s 12. 35 VLA, s 66(1). 36 See, eg, Land Valuation Amendment Act 1980 (Tas), s 2; Land Valuation Amendment (Relocatable Homes) Act 1999 (Tas), s 4. 37 See above at [29]. 38 Financial Reform Act, s 21. Nettle Gordon "The Valuer-General must, subject to this section, make – valuations of the land values, capital values and assessed annual values of all lands within each valuation district and Crown lands liable to be rated in accordance with Part 9 of the Local Government Act 1993; and valuations of the assessed annual values of such Crown lands and lands held by or on behalf of statutory authorities within the outer islands, and leased for grazing or agricultural purposes, as are liable to be rated in accordance with Part 9 of the Local Government Act Finally, in 2007, s 11(1) of the VLA was further amended to read as it now does39: "The Valuer-General must, subject to this section, make valuations of the land values, capital values and assessed annual values of all lands within each valuation district, including any Crown lands that are liable to be rated in accordance with Part 9 of the Local Government Act 1993." "And" and "including" The Solicitor-General of the State of Tasmania, appearing for the Valuer- General, contended that use of the participle "including" in the clause "including any Crown lands" in s 11(1) of the VLA as so amended implied that the "Crown lands" referred to are limited to lands of the Crown which come within the ordinary conception of "land" and hence exclude land under the sea. That contention should be rejected. Apart from the difficulty that "land" in its ordinary legal signification may include land under the sea40, the history of the legislation implies that "including" is used in its accepted expansive sense of adding to the scope of "lands" earlier referred to in the provision41. 39 Valuation of Land Amendment Act 2006 (Tas), s 11. 40 See [17]-[21] above. 41 YZ Finance Co Pty Ltd v Cummings (1964) 109 CLR 395 at 401-404 per Kitto J, 405-406 per Menzies J; [1964] HCA 12; Favelle Mort Ltd v Murray (1976) 133 CLR 580 at 589 per Barwick CJ; [1976] HCA 13; Federal Commissioner of (Footnote continues on next page) Nettle Gordon As already noticed, when first enacted in 200342, s 11(1) of the VLA was split into two paragraphs. Relevantly, par (a) referred to "all lands within each valuation district and Crown lands liable to be rated in accordance with Part 9 of the Local Government Act 1993" (emphasis added). In that form, the use of the conjunction "and" implied that the scope of "Crown lands" was broader than, and added to, the scope of "land" as ordinarily understood. When s 11(1) was in that form it would have been difficult to contend that "Crown lands" in s 11(1)(a) was confined by the meaning of "land" defined in the VLA. Then, in 200743, pars (a) and (b) of s 11(1) were combined into a single sub-section which refers to "all lands within each valuation district, including any Crown lands that are liable to be rated in accordance with Part 9 of the Local Government Act 1993" (emphasis added). The Solicitor-General submitted that, upon the latter change taking effect, the use of "including" in place of "and" confined the term "Crown lands" to land of the Crown falling within the notion of "land" as ordinarily understood and so as excluding Crown land under the sea. That submission should also be rejected. Among other problems that it faces, there is no suggestion in the 2007 amending legislation44 or in any relevant extrinsic materials45 of a purpose of confining "Crown lands" to "land" or of otherwise excluding Crown land under the sea from the term "Crown lands". On the contrary, as already observed, the apparent purpose of exposing all Crown land to liability to be rated (except for Crown land that is applied to one of the specified public purposes in s 87(1)(b) of the LGA) is to subject to liability to be rated all forms of Crown land applied to what might be described as commercial Taxation v St Hubert's Island Pty Ltd (In liq) (1978) 138 CLR 210 at 216 per Stephen J; [1978] HCA 10; R v Gray; Ex parte Marsh (1985) 157 CLR 351 at 364- 365 per Gibbs CJ; [1985] HCA 67; Zickar v MGH Plastic Industries Pty Ltd (1996) 187 CLR 310 at 329-330 per Toohey, McHugh and Gummow JJ; [1996] HCA 31. 42 Financial Reform Act, s 21. 43 Valuation of Land Amendment Act 2006 (Tas), s 11. 44 Valuation of Land Amendment Act 2006 (Tas). 45 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 2 November 2006; Tasmania, House of Assembly, Valuation of Land Amendment Bill 2006, Clause Notes at 2. Nettle Gordon purposes (including Crown lands comprised of State waters which are leased for marine farming and other cognate commercial activities46). Consequently, the more rational and thus probable explanation of the use of "including" in place of "and" is that it is calculated to emphasise that the requirement that lands be within a valuation district applies equally to "Crown lands that are liable to be rated in accordance with Part 9 of the Local Government Act" as to "all lands" (and thereby emphasises that the Valuer- General is required to value only those Crown lands which are liable to be rated under Pt 9 of the LGA that are within a valuation district). That is consistent with "including" being used in the current iteration of s 11(1) in the same expansionary sense as "and" was used before the change of structure and, therefore, with it remaining that "Crown lands" in s 11(1) is not restricted to land of the Crown falling within the meaning of "lands" referred to earlier in the provision. That construction of s 11(1) of the VLA is also reinforced by the consideration that the CLA is the Act that makes provision generally "with respect to the management, sale, and disposal of the lands of the Crown"47 and provides directly or indirectly for all of the purposes for which Crown land may be used (including those public purposes specified in s 87(1) of the LGA). In particular, s 29 of the CLA provides expressly for the issue of leases of areas of State waters under the Marine Farming Planning Act 1995 (Tas) and it treats such leases as leases of Crown land48. Those provisions emphasise that marine farming leases are leases of Crown land and in turn that strengthens the implication that they are to be understood as "Crown lands" in s 11(1) of the VLA49 that are not the subject of an exemption in s 87(1) of the LGA. 46 See, eg, Marine Farming Planning Act 1995 (Tas), s 59; Living Marine Resources Management Act 1995 (Tas), Pt 4. 47 CLA, long title. 48 CLA, s 29(1), (2A). 49 Cf Federal Commissioner of Taxation v ICI Australia Ltd (1972) 127 CLR 529 at 540-542 per Walsh J, 581 per Gibbs J; [1972] HCA 75. Nettle Gordon Perhaps the CLA and the VLA cannot aptly be described as parts of an overlapping legislative scheme50. But, inasmuch as s 11(1) of the VLA applies to "Crown lands" and the CLA is the ultimate statutory enablement of all forms of holdings of and dealings with "Crown land"51, the VLA and the CLA are in pari materia. Absent any compelling contrary indication, it is to be inferred that reference to "Crown lands" in s 11(1) of the VLA is a reference to "Crown land" within the meaning of the CLA, and so includes Crown land under the sea and so much of the sea as lies above it as defined in the CLA. It remains to observe that, for so long as there was a general rating exemption applicable to lands of the Crown, it may not generally have been conceived of that "Crown lands" in the VLA or its antecedents included land under the sea. Since all of the sea below the low water mark was vested in the Crown52 and all Crown land (subject to limited exceptions) was exempt from liability to be rated, there was no obligation on the Valuer-General to value Crown land under the sea. But, once the general exemption of Crown land from liability to be rated was removed, with the result that Crown land became exposed generally to liability for rates (subject only to the specific public purpose exemptions provided for in s 87(1) of the LGA), any reason that there might have been to suppose that Crown land under the sea was not liable to be rated ceased to apply. Thenceforth, the replacement of the general exemption of "land owned by the Crown which is unoccupied or occupied exclusively for public purposes"53 with the specific public purpose exemptions for "land held or owned by the Crown" provided for in s 87(1) of the LGA bespoke a purpose of rendering liable to be rated all Crown land within a municipal area except Crown land being used for one or more of the public purposes described in s 87(1). The fact that one 50 Cf Sweeney v Fitzhardinge (1906) 4 CLR 716 at 726 per Griffith CJ; [1906] HCA 73. 51 Gale v Federal Commissioner of Taxation (1960) 102 CLR 1 at 11-12 per Fullagar J (Dixon CJ agreeing at 7); [1960] HCA 18. 52 See Coastal Waters (State Powers) Act 1980 (Cth); Coastal Waters (State Title) Act 1980 (Cth); see also New South Wales v The Commonwealth ("the Seas and Submerged Lands Case") (1975) 135 CLR 337; [1975] HCA 58. 53 Financial Reform Act, s 11. Nettle Gordon purpose provided for in s 87(1) encompasses the use of Crown land covered by the sea gives further emphasis to that conclusion54. Contrary to the submissions of the Valuer-General, that construction of s 11(1) of the VLA does not impose an onerous burden on the Valuer-General. Under s 11(1A), the Valuer-General may exempt land from the valuations to be made under s 11(1) if the Valuer-General considers that the land should not be included in those valuations. For example, the Valuer-General may consider that Crown land in Macquarie Harbour which is not the subject of exploitation should not be included in the valuations to be made under s 11(1). Conclusion In the result, it is to be concluded that "Crown lands" in s 11(1) of the VLA means "Crown land" within the meaning of the CLA and so includes the seabed and so much of the sea as lies above it. It follows that the appeal should be dismissed. 54 Section 87(1)(b)(xiii) of the LGA provides that "a marine facility, within the meaning of the Marine and Safety Authority Act 1997" is "exempt from ... rates".

HIGH COURT OF AUSTRALIA CHAUNCEY AARON BELL APPELLANT AND STATE OF TASMANIA RESPONDENT Bell v Tasmania [2021] HCA 42 Dates of Hearing: 5 & 6 October 2021 Date of Judgment: 8 December 2021 ORDER Appeal dismissed. On appeal from the Supreme Court of Tasmania Representation K L Baumeler with P J Willshire for the appellant (instructed by Philippa Willshire) D G Coates SC with M C Figg for the respondent (instructed by Office of the Director of Public Prosecutions (Tas)) M E O'Farrell SC, Solicitor-General for the State of Tasmania, with D R Osz for the Attorney-General for the State of Tasmania, intervening (instructed by Office of the Solicitor-General (Tas)) G A Thompson QC, Solicitor-General of the State of Queensland, with P M Clohessy for the Attorney-General of the State of Queensland, intervening (instructed by Crown Law (Qld)) D T Kell SC with E S Jones for the Attorney-General for the State of New South Wales, intervening (instructed by Crown Solicitor's Office (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Bell v Tasmania Criminal law – Defences – Honest and reasonable mistake of fact – Where appellant charged with supplying controlled drug to child contrary to s 14 of Misuse of Drugs Act 2001 (Tas) – Where appellant claimed he honestly and reasonably believed child was adult – Where appellant's conduct, had his belief been true, would have constituted lesser offence of supplying controlled drug contrary to s 26 of Misuse of Drugs Act – Where common law principle of honest and reasonable mistake of fact operates to excuse conduct that, on believed state of facts, would be innocent – Meaning of "innocent" – Whether appellant entitled to rely on excuse of honest and reasonable mistake of fact. Words and phrases – "common law principle", "criminal responsibility", "excuse", "ground of exculpation", "honest and reasonable but mistaken belief in the existence of any state of facts", "innocent", "justification", "mistake as to age", "voluntary and intentional". Criminal Code (Tas), ss 13, 14. Criminal Code Act 1924 (Tas), s 8. KIEFEL CJ AND KEANE J. The appellant was charged with one count of supplying a controlled drug to a child contrary to s 14 of the Misuse of Drugs Act 2001 (Tas). The appellant was also charged with one count of rape contrary to s 185(1) of the Criminal Code (Tas) ("the Tasmanian Code"). Both offences were alleged to have been committed against the same child, who was 15 years old at the time of the alleged offences. The Crown case was that the appellant injected the complainant with methylamphetamine and, sometime later, had sexual intercourse with her. In a record of interview with police, the appellant admitted to those acts, but claimed that the complainant told him, and he believed, that she was 20 years old. The trial judge (Blow CJ) ruled that the defence of honest and reasonable mistake as to the complainant's age was not available as a defence to the charge of supplying the complainant with a controlled drug because, even if the appellant's mistaken belief that the complainant was an adult had been true, he would still have committed the offence of supplying a controlled drug to another person contrary to s 26 of the Misuse of Drugs Act. His Honour directed the jury accordingly. The jury returned a guilty verdict in respect of the supply charge but failed to reach a verdict in respect of the rape charge. An appeal to the Court of Criminal Appeal of the Supreme Court of Tasmania (Pearce and Brett JJ and Martin A-J) concerned only the conviction relating to the charge of supplying a controlled drug to a child. The Court of Criminal Appeal upheld the trial judge's ruling that the defence of honest and reasonable mistake was not available and dismissed the appeal1. The Court of Criminal Appeal was correct. In this regard, we are in general agreement with the reasons of Edelman and Gleeson JJ. We write separately to observe that to accept the appellant's argument would require one to adopt an understanding of the operation of s 14 of the Tasmanian Code that cannot be supported as an exercise in statutory interpretation. Section 14 of the Misuse of Drugs Act proscribes the intentional2 supply of a controlled drug to a person who was, in fact, a child. It is uncontroversial that, to prove the commission of an offence against s 14, the prosecution need not prove that the accused knew or believed that the person to whom the controlled drug was supplied was a child. 1 Bell v Tasmania (2019) 279 A Crim R 553. See s 13 of the Tasmanian Code; Vallance v The Queen (1961) 108 CLR 56. Section 14 of the Tasmanian Code provides: "Whether criminal responsibility is entailed by an act or omission done or made under an honest and reasonable, but mistaken, belief in the existence of any state of facts the existence of which would excuse such act or omission, is a question of law, to be determined on the construction of the statute constituting the offence." The term "excuse" is not defined in the Tasmanian Code. However, "criminal responsibility" is defined to mean "liability to punishment as for an offence"3. "Offence" is in turn defined to mean "any breach of the law for which a person may be punished summarily or otherwise"4. Section 14 of the Tasmanian Code does not itself lay down a substantive rule of law. Rather, it acknowledges the existence of, and regulates the application of, a principle of the common law relating to the interpretation of statutes that create criminal offences5. The operative effect of s 14 is that the application of the common law principle of interpretation in any particular case depends on the true construction of the statute constituting the particular offence. The notion that s 14 acknowledges a ground of exculpation which has its basis in the common law is supported by s 8 of the Criminal Code Act 1924 (Tas), which provides: "Saving of common law defences All rules and principles of the common law which render any circumstances a justification or excuse for any act or omission, or a defence to a charge upon indictment, shall remain in force and apply to any defence to a charge upon indictment, except in so far as they are altered by, or are inconsistent with, the Code." The interpretative principle of the common law recognised by s 14 of the Tasmanian Code has variously been referred to as a circumstance of excuse or exculpation or as a defence to a charge6. This interpretative principle had its origins in the willingness of the judges of Victorian England to gloss the terms of a statute s 1 of the Tasmanian Code. s 1 of the Tasmanian Code. 5 Compare Proudman v Dayman (1941) 67 CLR 536 at 540. Thomas v The King (1937) 59 CLR 279 at 304; CTM v The Queen (2008) 236 CLR to an extent that reflected the historical development of the criminal law in England over centuries as something of a collaboration between the judges and the Parliament. The rationale for the judicial gloss can be found in the view of the judges of Victorian England that there would be an unacceptable gap between moral culpability and criminal responsibility if a statute constituting an offence were construed as imposing criminal responsibility for an act or omission which the accused honestly and reasonably believed to be lawful. This rationale was clearly articulated in R v Tolson7. In this regard, in CTM v The Queen8, Gleeson CJ, Gummow, Crennan and Kiefel JJ cited the following passages from the judgment of Cave J in Tolson9: "At common law an honest and reasonable belief in the existence of circumstances, which, if true, would make the act for which a prisoner is indicted an innocent act has always been held to be a good defence. ... Now it is undoubtedly within the competence of the legislature to enact that a man shall be branded as a felon and punished for doing an act which he honestly and reasonably believes to be lawful and right; just as the legislature may enact that a child or a lunatic shall be punished criminally for an act which he has been led to commit by the immaturity or perversion of his reasoning faculty. But such a result seems so revolting to the moral sense that we ought to require the clearest and most indisputable evidence that such is the meaning of the Act." In CTM, the plurality went on to say10: "[T]he point made by Cave J at the end of the second passage quoted above continues to be of fundamental importance to the function of courts in seeking to find and give effect to the meaning of criminal legislation. While the strength of the consideration may vary according to the subject matter of the legislation11, when an offence created by Parliament carries serious penal consequences, the courts look to Parliament to spell out in clear terms (1889) 23 QBD 168. (2008) 236 CLR 440 at 445-446 [3]-[4]. (1889) 23 QBD 168 at 181-182. (2008) 236 CLR 440 at 447 [7]-[8]. 11 As explained by Dixon J in Proudman v Dayman (1941) 67 CLR 536 at 540. any intention to make a person criminally responsible for conduct which is based on an honest and reasonable mistake. ... Where it is a ground of exculpation, the law in Australia requires that the honest and reasonable, but mistaken, belief be in a state of affairs such that, if the belief were correct, the conduct of the accused would be innocent. In that context, the word 'innocent' means not guilty of a criminal offence. In the case of an offence, or a series of offences, defined by statute, it means that, if the belief were true, the conduct of the accused would be 'outside the operation of the enactment'12." It is apparent that the common law interpretative gloss recognised by s 14 of the Tasmanian Code was justified by the need to avoid "the public scandal of convicting on a serious charge persons who are in no way blameworthy"13. But the unacceptable affront to the moral sense that provided the rationale for the common law gloss did not arise in cases where the act of the accused was such that he or she would rightly "be branded as a felon and punished"14 even if the facts of the case were indeed as the accused believed them to be. That this is so is apparent from the statements in the authorities that, for the ground of exculpation to apply, the act in question must have been believed by the accused to be "innocent"15. That understanding of the rationale for the common law gloss, and the expression of the common law principle of interpretation to which it gave rise, was confirmed by a majority of this Court in Bergin v Stack16, and in the reasons of the plurality in CTM17. So understood, the rationale for the judicial gloss does not support a further and more nuanced gloss on the meaning of a statute whereby the act of an accused would be excused even where, on the mistaken view of the facts asserted by the accused, the act would warrant conviction of an offence against that statute. In 12 Proudman v Dayman (1941) 67 CLR 536 at 541. 13 Sweet v Parsley [1970] AC 132 at 150; He Kaw Teh v The Queen (1985) 157 CLR 523 at 565; CTM v The Queen (2008) 236 CLR 440 at 484 [148]. 14 R v Tolson (1889) 23 QBD 168 at 182. 15 Bergin v Stack (1953) 88 CLR 248 at 262-263; CTM v The Queen (2008) 236 CLR 440 at 447 [8], 453 [27]. See also Proudman v Dayman (1941) 67 CLR 536 at 541; R v Reynhoudt (1962) 107 CLR 381 at 389. (1953) 88 CLR 248 at 253, 262-263, 277. (2008) 236 CLR 440 at 447 [8], 453 [27]. such a case, the unacceptable prospect of convicting a person of a serious charge where that person is "in no way blameworthy" does not arise. This understanding of the common law interpretative principle recognised in s 14 of the Tasmanian Code is confirmed by the textual focus of s 14 upon the "act or omission" that is said to entail "criminal responsibility". Section 14 refers to a "state of facts the existence of which would excuse such act or omission" from criminal responsibility "entailed" by that act or omission. The ordinary and natural reading of these words confirms that the common law interpretative principle there recognised excuses the accused from any and all criminal responsibility entailed by the act or omission, but only where the act or omission is done under an operative mistake. The point may be illustrated by reference to the present case. The act of the appellant which entailed criminal responsibility was the supply of a controlled drug to another. By reason of s 26 of the Misuse of Drugs Act, that act is an offence. That the moral culpability of a person who commits that offence is less than that of a person who supplies a controlled drug to someone he or she knows to be a child may, no doubt, be reflected in the sentence to be imposed18; but it cannot be said that the former act would be "innocent" or "in no way blameworthy". There is not that gulf between moral culpability and criminal responsibility that arises when the act of an accused has been committed with an honest and reasonable belief that the act was lawful. It must be acknowledged that the common law principle of interpretation recognised by s 14 of the Tasmanian Code operates in a rather "blunt" way in that it does not seek to align the extent of criminal responsibility precisely with the degree of moral culpability revealed by the accused's belief as to the state of affairs in which he or she acts. In this regard, it may be noted that s 14 of the Tasmanian Code stands in marked contrast to the Criminal Code (Qld) ("the Queensland Code"), which expressly provides that an accused is criminally responsible only to the level that his or her acts or omissions are not affected by mistake. Section 24(1) of the Queensland Code provides19: "A person who does or omits to do an act under an honest and reasonable, but mistaken, belief in the existence of any state of things is not criminally responsible for the act or omission to any greater extent than if the real state of things had been such as the person believed to exist." 18 CTM v The Queen (2008) 236 CLR 440 at 453 [27]. 19 See also s 24 of the Criminal Code (WA). Yet the argument for the appellant would have it that the effect of the interpretative principle recognised by s 14 of the Tasmanian Code is no different from the effect of s 24 of the Queensland Code, save that, in this case, the appellant could not even be held criminally responsible for the lesser offence under s 26 of the Misuse of Drugs Act because he was not charged with that offence as an alternative charge on the indictment. The obvious differences between the terms of the Tasmanian and Queensland provisions render this argument distinctly implausible. The text of s 24 of the Queensland Code expressly aligns criminal responsibility for an act with the moral culpability associated with the accused's belief. It achieves that result by focussing on the "state of things" in which an act is committed, and fixing the extent of criminal responsibility for the act by reference to that state of things honestly and reasonably believed to exist. The ordinary and natural meaning of the text of the Queensland Code requires criminal responsibility to be determined by reference to that believed "state of things" and not to the criminality entailed by the "act" in question. At this point, it is necessary to observe that, in Thomas v The King20, Dixon J, having referred to statements in the authorities of the interpretative principle of the common law, said: "The rule or rules have been embodied in the three criminal codes of Australia – Queensland, secs 22 and 24, Tasmania, secs 12 and 14, and Western Australia, secs 22 and 24. These provisions, which are in the same terms, state, in my opinion, the common law with complete accuracy." It was simply not correct to say that the relevant provisions of the Tasmanian and Queensland Codes are in the same terms. That is readily apparent from a textual comparison of the two provisions. That Dixon J did not observe the differences between these provisions has not passed without remark21. No doubt the muted tone of those remarks reflects the high and universal esteem in which the judicial work of Sir Owen Dixon is held. But the difference between the two statutory provisions – and indeed between the common law interpretative principle (1937) 59 CLR 279 at 305-306. 21 See Walden v Hensler (1987) 163 CLR 561 at 570, 580, 591. and the substantive rule enacted in s 24 of the Queensland Code – has consistently been recognised by the courts22 and by learned commentators23. It may be observed that Sir Samuel Griffith, in a marginal note to the provision in his Draft of a Code of Criminal Law that was enacted to become s 24 of the Queensland Code, wrote "Common Law"24. That marginal note may be understood as a reference by Sir Samuel to the origins of what became s 24 of the Queensland Code, rather than as an assertion that the text of the Queensland Code effected no alteration to the common law. It might also be that Sir Samuel envisaged the terms of s 24 of the Queensland Code to be the natural development of the rationale underlying the common law principle of interpretation and the concomitant expression of a more nuanced rule aligning criminal responsibility with moral culpability25. But there is little to be gained by further speculation as to What matters for present purposes is the meaning and effect of the Tasmanian Code. The Tasmanian legislature chose to enact the Tasmanian Code with its mixture of common law principles and re-enactments of statute law. As Windeyer J observed in Vallance v The Queen26 in relation to the Tasmanian Code: "In some places the Code states common law principles in words that have long been familiar. Other parts of it are a mere assembly of old statute law, re-enacted in its terms." The Tasmanian legislature had before it the Queensland Code when it enacted the Tasmanian Code. There is simply no escaping the conclusion that the Tasmanian legislature, in enacting s 14 of the Tasmanian Code, chose to eschew the adoption of s 24 of the Queensland Code and chose instead to adhere to the common law principle of interpretation. Whatever the wisdom of that choice, one can be in no doubt that the choice was made. For this Court now to accept the construction of s 14 of the Tasmanian Code propounded by the appellant would be to set aside a clear legislative choice and exercise that choice afresh. That is not a 22 Anderson v Nystrom [1941] St R Qd 56 at 69-70; Loveday v Ayre; Ex parte Ayre [1955] St R Qd 264 at 267; R v Mrzljak [2005] 1 Qd R 308 at 315 [21], 326 [75]. 23 Fairall and Barrett, Criminal Defences in Australia, 5th ed (2017) at [2.10]; Australia, Review of Commonwealth Criminal Law, Interim Report: Principles of Criminal Responsibility and Other Matters (1990) at 69 [7.9]. 24 Griffith, Draft of a Code of Criminal Law (1897) at 13. 25 Compare Hardgrave v The King (1906) 4 CLR 232 at 237. (1961) 108 CLR 56 at 74-75. course that is available as a matter of statutory interpretation according to the contemporary understanding of the orthodox exercise of judicial power. The appeal should be dismissed. I agree that the appeal must be dismissed. The facts and statutory provisions having been set out in other reasons for judgment, I can state my reasons briefly. The offence created by s 14 of the Misuse of Drugs Act 2001 (Tas) has two physical elements. The first is an act – supplying a controlled drug. By operation of s 13(1) of the Criminal Code, found in Sch 1 to the Criminal Code Act 1924 (Tas), an accused can be criminally responsible for that act only if the act is voluntary and intentional. The second physical element of the offence is the existence of a state of fact – that the person to whom the supply is made is a child. Section 14 of the Criminal Code speaks to whether an honest and reasonable but mistaken belief that the person to whom the supply is made is not a child excuses the act of voluntary and intentional supply of the controlled drug from criminal responsibility. What s 14 tells us – and all that s 14 tells us27 – is that is a question of law to be determined on the proper construction of s 14 of the Misuse of Drugs Act. Section 8 of the Criminal Code Act then tells us that the common law presumption of statutory interpretation, as expounded in He Kaw Teh v The Queen28 and in CTM v The Queen29 by reference to the statement of principle of Cave J in R v Tolson30, applies to the construction of s 14 of the Misuse of Drugs Act. The common law presumption is that an honest and reasonable but mistaken belief in the existence of a state of fact on the part of an accused will excuse the accused from criminal responsibility for the act in respect of which the accused stands charged of an offence only if that state of fact, if true, would have made the act "innocent". Whatever uncertainty may have been implicit in earlier and more tentative statements of the common law presumption in Thomas v The King31 and in 27 cf R v Martin [1963] Tas SR 103 at 110. (1985) 157 CLR 523 at 532. (2008) 236 CLR 440 at 446-447 [7]-[8]. (1889) 23 QBD 168 at 181. (1937) 59 CLR 279 at 304-306. Proudman v Dayman32, Bergin v Stack33 is unambiguous authority for the proposition that an act is only "innocent" within the meaning of the common law presumption if it is not a criminal offence at all. There, a steward in a club was charged with the offence of having made an unlicensed sale of liquor. He claimed that he believed that the club had a licence. The holding was that his mistaken belief, assuming it to have been honest and reasonable, did not excuse him from criminal responsibility for the sale which constituted the offence charged. That was because, had his belief been true, he would still have committed the separate offence of having sold liquor outside lawful trading hours for a licensed club, since the sale had been proved to have been made at 6.40 pm. The plurality in CTM reflected that holding in Bergin in stating that "innocent" in this context "means not guilty of a criminal offence"34. The plurality in CTM cannot be taken by its subsequent references to Proudman35 to have been departing from the holding in Bergin. There is no reason now to depart from the holding in Bergin that an honest and reasonable but mistaken belief in the existence of a state of fact will excuse criminal responsibility for the act only if the state of fact, if true, would have made the act not a criminal offence at all. To the contrary, there is good reason to adhere to the holding. For nearly 70 years, it has provided a stable foundation of common law interpretative principle by reference to which legislatures throughout Australia have formulated and explicated myriad statutory offences. Sections 14A and 14B of the Criminal Code – which respectively deal with mistake as to consent in certain sexual offences and mistake as to the age of victims in relation to certain sexual offences – are examples of legislative explication of statutory offences proceeding on that common law foundation. Applying that common law presumption to the construction of s 14 of the Misuse of Drugs Act leads to the conclusion that an honest and reasonable but mistaken belief that the person to whom the supply is made is not a child does not excuse the voluntary and intentional supply of the controlled drug to a person who is in fact a child. That is because the voluntary and intentional supply of the controlled drug to a person who is not a child is not "innocent": it is an offence against s 26 of the Misuse of Drugs Act. (1941) 67 CLR 536 at 540-541. (1953) 88 CLR 248 at 253, 262-263, 277. (2008) 236 CLR 440 at 447 [8]. See also at 491 [174], 497 [199]. (2008) 236 CLR 440 at 447 [8], 453 [27]. Procedural fairness issues might well arise in a case, closer to Bergin, in which an element of the separate offence which the accused would have committed had the state of fact believed by the accused been true is not an element of the offence of which the accused stands charged. In Bergin, for example, the timing of the sale was not an element of the offence with which the steward was charged. No issue of that nature arises here given that the voluntary and intentional supply of the controlled drug sufficient to establish the first element of the offence against s 14 of the Misuse of Drugs Act is sufficient in itself to establish the offence against s 26 of the Misuse of Drugs Act. Here, as in CTM36, on the facts which must be taken to have been found by the jury, the postulated mistake of the appellant "would merely take the case out of one prohibition into another" so as to render his mistake no more than "a mistake about the kind of offence that [was] being committed". (2008) 236 CLR 440 at 453 [27]. GordonJ GORDON AND STEWARD JJ. The appellant, Mr Bell, injected a 15-year-old female with methylamphetamine. He was relevantly charged on indictment, and convicted, of supplying a controlled drug to a child, a person who had not attained the age of 18 years, contrary to s 14 of the Misuse of Drugs Act 2001 (Tas)37. Mr Bell did not give evidence, but the prosecution adduced a record of interview between him and the police in which he claimed he believed that the female was 20 years of age. The trial judge ruled that the defence38 of honest and reasonable mistake as to age was not available to Mr Bell as an excuse to the charge. In summing up, the trial judge directed the jury that if Mr Bell had a mistaken belief that the female was aged 18 years or more "that makes no difference". The question is whether the trial judge erred in ruling that honest and reasonable mistake of fact was not available to Mr Bell. The answer is "no". The background to this appeal and the applicable provisions of the Criminal Code (Tas) and the Misuse of Drugs Act are set out in the reasons of Edelman and Gleeson JJ. We write separately because we consider the principles to be applied in the circumstances of this case to be sufficiently stated in Bergin v Stack39 and CTM v The Queen40. Part 2 of the Misuse of Drugs Act, headed "Major offences", includes s 14, which provides that "[a] person must not supply a controlled drug to a child"41. Offences in Pt 2 are indictable offences42. The Criminal Code is Sch 1 to the Criminal Code Act 1924 (Tas). The Criminal Code applies to all "crime[s]", defined to mean "an offence 37 Misuse of Drugs Act, s 14 read with s 3(1) definition of "child". 38 This term is used without pre-empting questions of onus of proof: CTM v The Queen (2008) 236 CLR 440 at 446 [6]. (1953) 88 CLR 248 at 262-263. (2008) 236 CLR 440 at 447 [8]. 41 Pursuant to s 3(1) of the Misuse of Drugs Act, "child" means "a person who has not attained the age of 18 years", "controlled drug" means "a substance, other than a growing plant, specified or described in Part 2 of Schedule 1" to the Misuse of Drugs Act (which relevantly includes methylamphetamine), and "supply", in relation to a substance, relevantly includes "administer[ing] the substance". 42 Misuse of Drugs Act, s 5. GordonJ punishable upon indictment"43. It therefore applies to the offence created by s 14 of the Misuse of Drugs Act. Chapter IV of Pt I of the Criminal Code, headed "Criminal Responsibility", relevantly contains ss 13 and 14. Section 13, headed "Intention and motive", provides: "(1) No person shall be criminally responsible for an act, unless it is voluntary and intentional; nor, except as hereinafter expressly provided, for an event which occurs by chance. Except as otherwise expressly provided, no person shall be criminally responsible for an omission, unless it is intentional. (3) Any person who with intent to commit an offence does any act or makes any omission which brings about an unforeseen result which, if he had intended it, would have constituted his act or omission some other offence, shall, except as otherwise provided, incur the same criminal responsibility as if he had effected his original purpose. Except where it is otherwise expressly provided, the motive by which a person is induced to do any act or make any omission is immaterial." Two matters should be stated at the outset. First, the Criminal Code provides that no person shall be criminally responsible for an act, unless the act is voluntary and intentional44. The "act" which must be "voluntary and intentional" under s 13(1) is the physical act of the accused and not the whole actus reus45. Second, in the context of s 14 of the Misuse of Drugs Act – supply of a controlled drug to a child – the supply of a controlled drug is the act that must be both voluntary and intentional. In the present appeal, there was no dispute that Mr Bell voluntarily and intentionally supplied a controlled drug. It was thus found below, and is not challenged on appeal, that the mental element required by s 13(1) 43 Criminal Code, s 1 definition of "crime"; Criminal Code Act, s 4(1). 44 Criminal Code, s 13(1). 45 Vallance v The Queen (1961) 108 CLR 56 at 64, 68-69, 71; Kaporonovski v The Queen (1973) 133 CLR 209 at 230-231; R v Falconer (1990) 171 CLR 30 at 38, 81. See also Snow v The Queen [1962] Tas SR 271 at 278. cf He Kaw Teh v The Queen (1985) 157 CLR 523 at 582. GordonJ of the Criminal Code for s 14 of the Misuse of Drugs Act "will not apply to the surrounding circumstances necessary to establish the crime" (emphasis added), namely that "the substance is a controlled drug and that the person to whom the drug is supplied is a child". Mr Bell's defence was that he thought that the female to whom he supplied the controlled drug was not a child but was 20 years of age. But the age of a person is not an act – it is a state of fact. Section 14 of the Criminal Code provides that it is a question of law whether, for a given offence, an excuse of reasonable mistake of fact is available. Section 14, headed "Mistake of fact", provides: "Whether criminal responsibility is entailed by an act or omission done or made under an honest and reasonable, but mistaken, belief in the existence of any state of facts the existence of which would excuse such act or omission, is a question of law, to be determined on the construction of the statute constituting the offence." (emphasis added) Section 8 of the Criminal Code Act provides that "[a]ll rules and principles of the common law which render any circumstances a justification or excuse for any act or omission, or a defence to a charge upon indictment, shall remain in force and apply to any defence to a charge upon indictment, except in so far as they are altered by, or are inconsistent with, the Code" (emphasis added). On the proper construction of s 14 of the Criminal Code, the common law principle of honest and reasonable but mistaken belief applies46: the common law principle is not altered by, or inconsistent with, s 14 of the Criminal Code47. The next question posed by s 14 of the Criminal Code is whether, as a matter of construction, s 14 of the Misuse of Drugs Act would exclude the operation of the reasonable mistake of fact excuse in s 14 of the Criminal Code. The answer is there is nothing in s 14 of the Misuse of Drugs Act that would have that effect48. 46 Criminal Code Act, s 8. 47 Thomas v The King (1937) 59 CLR 279 at 305-306; Snow [1962] Tas SR 271 at 277, 296; R v Martin [1963] Tas SR 103 at 109, 135; Attorney-General's Reference No 1 of 1989 [1990] Tas R 46 at 55, 63. 48 cf, eg, Corporations Act 2001 (Cth), s 588G(3A) and Criminal Code (Cth), s 6.2(1). GordonJ Section 14 of the Criminal Code states and embodies the common law principle of mistake of fact as a ground of exculpation49. The common law principle of honest and reasonable but mistaken belief was set out in Bergin50 and CTM51: it is a ground of exculpation if an accused can establish an honest and reasonable belief in a state of facts which, if true, would make the act of the accused "innocent", where "innocent" means not guilty of any criminal offence. The evidentiary onus of raising the ground of exculpation is on the accused, but, once that occurs, the ultimate legal onus of displacing the ground lies on the prosecution52. There is no reason now to depart from Bergin or CTM. Applying that principle to the offence created by s 14 of the Misuse of Drugs Act in this case, even if Mr Bell held an honest and reasonable belief in the fact that the female he supplied with a controlled drug was 20 years of age, the act – the supply of a controlled drug – was not capable of being excused because the act of supplying a controlled drug was criminal. It was an offence contrary to s 26 of the Misuse of Drugs Act. The fact that Mr Bell would not be excused of the charged offence on the indictment, even if he held an honest and reasonable but mistaken belief about the age of the female to whom he supplied the controlled drug, is not harsh, unfair or otherwise contrary to the principles of the criminal justice system53. First, the act – the supply of a controlled drug – was the particular act alleged as the foundation of the relevant charge in the indictment54. Second, as the plurality in CTM observed, a mistake of fact which would merely take a case "out of one prohibition 49 Thomas (1937) 59 CLR 279 at 305-306; Snow [1962] Tas SR 271 at 277, 296; Martin [1963] Tas SR 103 at 109, 135; Attorney-General's Reference No 1 of 1989 [1990] Tas R 46 at 55, 63. (1953) 88 CLR 248 at 262-263. (2008) 236 CLR 440 at 447 [8]. 52 CTM (2008) 236 CLR 440 at 447 [8], citing He Kaw Teh (1985) 157 CLR 523 at 53 Ratten v The Queen (1974) 131 CLR 510 at 517; Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 557 [26], relevantly citing Johnson v Miller (1937) 59 CLR 467 at 486, 489 and John L Pty Ltd v Attorney-General (NSW) (1987) 163 CLR 508 54 Kirk (2010) 239 CLR 531 at 557 [26], citing Johnson (1937) 59 CLR 467 at 489. GordonJ into another" is "legally irrelevant to guilt, although it could possibly have some consequence for sentencing purposes"55. Parliaments have relied on the common law principle of honest and reasonable but mistaken belief in drafting and creating offences56. Section 14 of the Criminal Code in its terms – "[w]hether criminal responsibility is entailed by an act or omission done or made under an honest and reasonable, but mistaken, belief in the existence of any state of facts ... [is] to be determined on the construction of the statute" – reinforces that view. This appeal is not the appropriate vehicle to seek to qualify or clarify the outer limits of the common law principle of honest and reasonable mistake. Finally, s 13(3) of the Criminal Code – which is concerned with criminal responsibility for an act or omission, with intent to commit an offence, which brings about an unforeseen result which, if intended, would have constituted some other offence – was not relevant in this appeal. Section 13(3) is concerned with unforeseen results57. The appeal is dismissed. (2008) 236 CLR 440 at 453 [27]. 56 See, eg, Criminal Code, ss 14A and 14B. 57 R v Vallance [1960] Tas SR 51 at 94, 115-117. Edelman Gleeson Introduction This appeal concerns the common law excuse of honest and reasonable mistake of fact for an act that would otherwise constitute an offence. Where the excuse is available, and sufficient evidence has been led to permit the excuse to be left to the jury, an offence can be excused if the prosecution does not negate that the accused person acted or failed to act under an honest and reasonable, but mistaken, belief in the existence of any fact which, if true, would make the act an "innocent act". Other than in the differently expressed Criminal Codes in Queensland and Western Australia, the same common law excuse of honest and reasonable mistake is usually contained, by implication, in statutory offences in Australia. In Tasmania, statutory indictable offences are incorporated into the Criminal Code (Tas)58 and common law excuses will apply to the incorporated offences59, subject to interpretation of the provisions that create those offences60. This appeal is not concerned with difficult questions that have arisen about the scope of the common law excuse such as whether the excuse is limited to mistakes about existing facts or whether ignorance or a tacit belief can be treated as a mistake within the common law excuse61. The sole issue on this appeal concerns the qualification upon the common law excuse that the facts as honestly and reasonably believed must make the act of an accused person an "innocent act". The authorities have taken four different approaches. Must the person's act, on the facts as honestly and reasonably believed by them, make the person: (i) innocent of any offence, civil wrongdoing or immoral conduct? (ii) innocent of any offence or civil wrongdoing? (iii) innocent of any offence? (iv) innocent of the particular offence charged? For the reasons below, the correct qualification is (iii). The accused person's act, on the facts as honestly and reasonably believed by them, must render the accused person innocent of any offence. It is in the nature of the common law excuse that the accused person is not punished for an offence despite all elements of the offence being satisfied by their action due to the "beliefs ... on the strength 58 Criminal Code Act 1924 (Tas), s 4(1). 59 Criminal Code Act, s 8. 60 Criminal Code (Tas), s 14. 61 cf Criminal Code (Cth), ss 9.1-9.4. Edelman Gleeson of which [they] took that action"62. An honest and reasonable belief in facts that would nevertheless have involved a different offence cannot entirely excuse offending action at common law. Nevertheless, systemic considerations which preclude the conduct of a trial within a trial, based on new and disputed facts or allegations, may constrain the manner in which the prosecution can exclude the excuse of honest and reasonable mistake on the basis that the act of the accused person would constitute a different offence if the facts believed by the accused were true. Such considerations do not apply in this case. The trial judge in this case, Blow CJ, was correct not to leave to the jury the excuse of honest and reasonable mistake of fact on the basis of Mr Bell's assertion that, for a charge of supplying a controlled drug to a child, he honestly and reasonably believed that the person was over the age of 18 years. That belief would nevertheless have amounted to another offence: the offence of supplying a controlled drug to another person. The Court of Criminal Appeal of the Supreme Court of Tasmania (Pearce and Brett JJ and Martin A-J) was correct to dismiss the appeal. The appeal to this Court should be dismissed. Background In 2019, the appellant, Mr Bell, was charged with one count of supplying a controlled drug to a child, being a person under the age of 18 years63, contrary to s 14 of the Misuse of Drugs Act 2001 (Tas). There is no statutory alternative conviction for s 1464. He was also charged with one count of rape, contrary to s 185(1) of the Criminal Code. By s 335 of the Criminal Code, a statutory alternative offence upon an indictment for rape is the offence in s 124 of sexual intercourse with a young person under 17 years of age. The facts of Mr Bell's offending were as follows. Between midnight and 1 am on 13 October 2018, the complainant, who was 15 years old at the time, went to the house where Mr Bell was living. She was accompanied by a man called Mr Percy. They both went to the house to purchase drugs. Mr Percy bought methylamphetamine from a dealer who was living at the house with Mr Bell and Mr Percy then injected the methylamphetamine into his own arm. The complainant 62 Gardner, Offences and Defences: Selected Essays in the Philosophy of Criminal Law 63 Misuse of Drugs Act 2001 (Tas), s 3(1) (definition of "child"). 64 See Criminal Code, s 332(1), together with the absence of any provision for an alternative conviction to s 14 in Misuse of Drugs Act, s 36A. Edelman Gleeson had no experience injecting drugs so Mr Bell injected methylamphetamine into her arm, which was the basis for the charge of supplying a controlled drug to a child. Mr Bell subsequently called a taxi for the complainant and Mr Percy. When the taxi arrived, Mr Bell invited the complainant to go for a walk with him rather than departing with Mr Percy. The complainant agreed to do so. Mr Bell and the complainant walked to a grassy area where sexual intercourse took place, which was the basis for the charge of rape and the statutory alternative of sexual intercourse with a young person under 17 years of age. At Mr Bell's first trial, the trial judge instructed the jury that they could not find Mr Bell guilty of the alternative offence of sexual intercourse with a young person under 17 years of age unless the jury were satisfied that Mr Bell did not hold an honest and reasonable mistaken belief that the complainant was aged 17 years or older. However, in relation to the offence of supplying a controlled drug to a child, the trial judge directed the jury that it made no difference if Mr Bell held an honest and reasonable mistaken belief that the complainant was aged 18 years or over. The jury convicted Mr Bell of the offence of supplying a controlled drug to a child but were unable to reach a verdict in relation to the sexual offences. Mr Bell was retried for the sexual offences. At his second trial he was found not guilty of rape but guilty of the alternative offence of sexual intercourse with a young person under 17 years of age. Consequent upon the convictions at the two trials, the trial judge sentenced Mr Bell to partly cumulative terms of nine months' imprisonment for the offence of supplying a controlled drug to a child and 10 months' imprisonment for the offence of sexual intercourse with a young person under 17 years of age, with a total effective sentence of 14 months' imprisonment. Mr Bell appealed to the Court of Criminal Appeal of the Supreme Court of Tasmania against his conviction at the first trial for the offence of supplying a controlled drug to a child. He submitted that the trial judge should have directed the jury that they could not convict of that offence unless they were satisfied that Mr Bell did not hold an honest and reasonable mistaken belief that the complainant was aged 18 years or over. Mr Bell's appeal was unanimously dismissed. The Criminal Code and the Misuse of Drugs Act The Criminal Code Act and the Criminal Code The Criminal Code was established by the Criminal Code Act 1924 (Tas). Section 4(1) of the Criminal Code Act provides relevantly that, for the purposes of the Criminal Code Act, every statute shall be "read and construed as if any offence therein mentioned ... were described or referred to as a crime as defined by the Code; and all provisions of this Act relating to crimes generally shall apply to every Edelman Gleeson such offence". The effect of s 4(1) of the Criminal Code Act is to: (i) incorporate into the Criminal Code all Tasmanian offences that may be prosecuted on information or indictment; and (ii) make all of those offences subject to the provisions of the Criminal Code Act. Section 8 of the Criminal Code Act is a provision that prima facie applies all the justifications and excuses recognised by the common law to the offences in the Criminal Code, including those offences incorporated into the Criminal Code by s 4(1). Section 8 provides: "All rules and principles of the common law which render any circumstances a justification or excuse for any act or omission, or a defence to a charge upon indictment, shall remain in force and apply to any defence to a charge upon indictment, except in so far as they are altered by, or are inconsistent with, the Code." Chapter IV of the Criminal Code, entitled "Criminal Responsibility", affects the operation of the Criminal Code upon all indictable Tasmanian offences, together with the common law justifications and excuses incorporated by the Criminal Code Act. In Vallance v The Queen65, Dixon CJ said that the Criminal Code was conceived, and to some extent drafted, upon a plan "to provide for specific crimes but to treat the complete definition of them as finally governed or controlled by Ch IV (criminal responsibility)". His Honour said that this plan had not been, and could not be, uniformly carried out: there will be some offences where the mental element of the offence is contained within the offence provision itself independently of Ch IV of the Criminal Code66. In Vallance, Dixon CJ proceeded by "accepting the view" that no mental element was contained in the offence provision in that case67. In such circumstances it is necessary to turn to the provisions of Ch IV to ascertain the content of any required mental element of the offence. Two of the provisions contained in Ch IV of the Criminal Code are ss 13 and 14. Section 13(1) of the Criminal Code provides that "[n]o person shall be criminally responsible for an act, unless it is voluntary and intentional; nor, except as hereinafter expressly provided, for an event which occurs by chance". In the (1961) 108 CLR 56 at 60. 66 See also Snow v The Queen [1962] Tas SR 271 at 295; R v Martin [1963] Tas SR 103 at 114; Arnol v The Queen [1981] Tas R 157 at 168; R v Bennett [1990] Tas R (1961) 108 CLR 56 at 60. Edelman Gleeson absence of any specific mental element required by an offence provision that is either in the Criminal Code or incorporated into the Criminal Code by s 4(1) of the Criminal Code Act, s 13(1) provides the requisite mental element for criminal responsibility for an act. In Vallance68, this Court divided on the meaning of an "act" for the purpose of s 13(1) in relation to a charge of unlawful wounding under s 172 of the Criminal Code. A broad approach was taken by Dixon CJ and Windeyer J, who each reasoned that the "act" was everything comprised in the wounding, so that everything comprised in the wounding needed to be voluntary and intentional69. By contrast, a narrow approach, which Taylor J "tended"70 to support, was taken by Kitto J and Menzies J. Their Honours reasoned that the "act" was only the physical, willed action which led to the wounding71. In Kaporonovski v The Queen72, Gibbs J (with whom Stephen J agreed) observed that, although this Court had been, in effect, "evenly divided" between the two approaches in Timbu Kolian v The Queen73, the narrow approach of Kitto J and Menzies J in Vallance should be adopted. In R v Falconer74, the narrow approach was also taken by Mason CJ, Brennan and McHugh JJ (with whom Gaudron J agreed on this point75). All parties to this appeal proceeded on the narrow view of "act" within s 13(1) as the physical, willed action independent of the circumstances in which that action occurred and independent of the consequences of the act. On this narrow approach, the intention required by s 13(1) is an intention only to do the physical, willed action. The intention does not concern the consequences or results of that action. (1961) 108 CLR 56. (1961) 108 CLR 56 at 61 (Dixon CJ), 79-80 (Windeyer J). 70 See Director of Public Prosecutions (NT) v WJI (2004) 219 CLR 43 at 51 [21], citing Vallance v The Queen (1961) 108 CLR 56 at 68-69. (1961) 108 CLR 56 at 64 (Kitto J), 71 (Menzies J). (1973) 133 CLR 209 at 230-231. (1968) 119 CLR 47. (1990) 171 CLR 30 at 38. See also Ugle v The Queen (2002) 211 CLR 171 at 178 (1990) 171 CLR 30 at 81. Edelman Gleeson Section 14 of the Criminal Code provides: "Whether criminal responsibility is entailed by an act or omission done or made under an honest and reasonable, but mistaken, belief in the existence of any state of facts the existence of which would excuse such act or omission, is a question of law, to be determined on the construction of the statute constituting the offence." The excuse of honest and reasonable mistake to which s 14 refers is the excuse in the form as developed by the common law and generally implied in statutory offence provisions76. Section 14 recognises that, as a matter of construction, the statute creating the offence, in this case the Misuse of Drugs Act, can exclude the common law excuse of honest and reasonable mistake. Otherwise, that common law excuse is, by s 8 of the Criminal Code Act and the common statutory implication, prima facie applied to all offences in the Criminal Code, including those offences incorporated by s 4(1) of the Criminal Code Act. The Misuse of Drugs Act Part 2 of the Misuse of Drugs Act is entitled "Major offences". Division 3 of Pt 2 is entitled "Trafficking and supply". Division 3 contains s 14, which provides that "[a] person must not supply a controlled drug to a child". A child is defined in s 3(1) as "a person who has not attained the age of 18 years". The maximum penalty for this offence, selected for reasons of consistency with the same maximum penalty for all indictable offences in Tasmania except murder or treason77, is imprisonment for a term not exceeding 21 years. Part 3 of the Misuse of Drugs Act is entitled "Minor offences". Division 4 of Pt 3 is entitled "Sale and supply". Division 4 contains s 26, which provides that "[a] person must not sell or supply a controlled drug to another person". The penalty for this offence is a fine not exceeding 100 penalty units or imprisonment for a term not exceeding four years. Although Mr Bell was not charged with an offence under s 26, in the Court of Criminal Appeal and in this Court there was no dispute that Mr Bell's conduct amounted to offences under both ss 14 and 26 of the Misuse of Drugs Act. This concession by Mr Bell was based upon the assumption that there is no mental element contained in either s 14 or s 26. In particular, in this Court, counsel for 76 R v Martin [1963] Tas SR 103 at 144, 150; Attorney-General's Reference No 1 of 1989 [1990] Tas R 46 at 55-56. 77 See Tasmania, House of Assembly, Parliamentary Debates (Hansard), 23 October 2001 at 52; Criminal Code, ss 56, 158, 389(3). Edelman Gleeson Mr Bell repeatedly disclaimed any submission that s 14 of the Misuse of Drugs Act contained any mental element. That concession was embraced by the State of Tasmania and not contradicted by any intervener. In the absence of any submissions to the contrary, the concession should be accepted. The consequence is that, subject to defences, the only mental element for the offence in s 14 of the Misuse of Drugs Act is supplied by s 13(1) of the Criminal Code. There was, and could be, no dispute that, on the narrow approach to an "act" in s 13(1), Mr Bell acted voluntarily and intended to perform the physical, willed act of supplying methylamphetamine to the complainant. The sole ground of Mr Bell's appeal to the Court of Criminal Appeal, like the sole ground of appeal in this Court, was therefore whether, on Mr Bell's first trial, the trial judge erred in not directing the jury that they could only convict Mr Bell if they were satisfied beyond reasonable doubt that his conduct was not excused because he did not have an honest and reasonable, but mistaken, belief that the complainant was 18 years or over. The development of the honest and reasonable mistake excuse Distinguishing the "common law" excuse from the elements of an offence Although the excuse of honest and reasonable mistake is one which the prosecution bears the substantive onus of disproving78, there is an important distinction between, on the one hand, the elements of a statutory offence, including whether knowledge or intention "is made an element of the statutory crime"79, and, on the other hand, a defence of honest and reasonable mistake that excuses, or is a "ground of exculpation"80 for, the action that amounted to the otherwise completed offence. Although both arise as a matter of statutory interpretation, this distinction is well established81. 78 He Kaw Teh v The Queen (1985) 157 CLR 523 at 534-535; CTM v The Queen (2008) 236 CLR 440 at 447 [8]. 79 Bank of New South Wales v Piper [1897] AC 383 at 389-390, quoted in Thomas v The King (1937) 59 CLR 279 at 304. See also He Kaw Teh v The Queen (1985) 157 CLR 523 at 535. 80 CTM v The Queen (2008) 236 CLR 440 at 447 [8]. 81 See Proudman v Dayman (1941) 67 CLR 536 at 540; Bergin v Stack (1953) 88 CLR 248 at 261; R v Reynhoudt (1962) 107 CLR 381 at 399. See also He Kaw Teh v The Queen (1985) 157 CLR 523 at 535. Edelman Gleeson Although the distinction is now well established, early decisions concerning the excuse of honest and reasonable mistake to a statutory offence did not always distinguish between the mental elements of the offence and matters that would excuse the offence. Many of those decisions applied Latin maxims82 which cut across the distinction and which were deprecated by Sir James Fitzjames Stephen as "most unfortunate, and not only likely to mislead, but actually misleading"83. In circumstances in which counsel for Mr Bell conceded that, apart from s 13(1) of the Criminal Code, there was no implied mental element contained in any element of the offence in s 14 of the Misuse of Drugs Act84, the issue in this case is whether the entirety of the action constituting the offence should be excused, not merely some aspect of it. Where the offence is a common law offence then, separately from the elements of the offence, the common law recognises an excuse of honest and reasonable mistake85. Where the offence is statutory, by the technique that recognised a statutory implication as based upon the "rule and reason" of the common law86, the excuse came to be recognised as implied in the statute. The implication is sometimes described as a "common law presumption"87. In this sense, it can be described as a "common law" excuse. But, as s 14 of the Criminal 82 See, eg, actus non facit reum, nisi mens sit rea; non est reus, nisi mens sit rea: see Black, A Dictionary of Law (1891) at 31, "An act does not make [the doer of it] guilty, unless the mind be guilty". 83 R v Tolson (1889) 23 QBD 168 at 185. See also CTM v The Queen (2008) 236 CLR 84 cf Cameron v Holt (1980) 142 CLR 342 at 346, 347, 348; He Kaw Teh v The Queen (1985) 157 CLR 523 at 537, 552, 565, 582. See also Gow v Davies (1992) 1 Tas R 85 Stephen, A Digest of the Criminal Law, 3rd ed (1883) at 26. 86 Coke, Institutes of the Laws of England (1628), pt 1, bk 3, ch 8, s 464 at 272. See also Cooper v The Wandsworth Board of Works (1863) 14 CB(NS) 180 at 194 [143 ER 414 at 420]. 87 See Thomas v The King (1937) 59 CLR 279 at 304; Proudman v Dayman (1941) 67 CLR 536 at 540; CTM v The Queen (2008) 236 CLR 440 at 486 [159], 497 [200], see also at 481 [141] explaining Hardgrave v The King (1906) 4 CLR 232 at 237. Edelman Gleeson Code recognises, and as the history of the development of the common law excuse shows, the terms of a particular offence can deny the implication88. The early judicial development of the common law excuse In written and oral submissions, counsel for Mr Bell focused in detail upon two early decisions which were very significant in the judicial development of the common law excuse. The first of those was R v Prince89. In that case, Mr Prince was convicted of a Victorian-era offence90 involving unlawfully taking an unmarried girl, under the age of 16 years, out of the possession and against the will of her father. A case was stated in the Court for Crown Cases Reserved as to whether it was an excuse that the girl went willingly with Mr Prince and that he honestly and reasonably believed that she was 18 years old. The sole dissentient of the 16 members of the Court was Brett J, later Master of the Rolls. In reasons with which nine other members of the Court concurred, Blackburn J held that the only basis upon which Mr Prince could succeed was if "the intention of the legislature should be presumed to be to include 'knowingly' in the definition of the crime, and the statute should be read as if that word were inserted"91. This implication was rejected as inconsistent with the purpose of the legislation92. In what Professor Cross described as a "'knock-out' argument"93, Blackburn J referred to other provisions of the same statute94 and added95: 88 Sherras v De Rutzen [1895] 1 QB 918 at 921; Maher v Musson (1934) 52 CLR 100 (1875) LR 2 CCR 154. 90 Offences against the Person Act 1861 (24 & 25 Vict c 100), s 55. (1875) LR 2 CCR 154 at 171. (1875) LR 2 CCR 154 at 171. See also at 175-176 (Bramwell B). 93 Cross, "Centenary Reflections on Prince's Case" (1975) 91 Law Quarterly Review 94 Offences against the Person Act 1861, ss 50 (a felony to unlawfully and carnally know a girl under the age of 10), 51 (a misdemeanour to unlawfully and carnally know a girl between the ages of 10 and 12 years). (1875) LR 2 CCR 154 at 171. See also at 175-176 (Bramwell B). Edelman Gleeson "It would produce the monstrous result that a man who had carnal connection with a girl, in reality not quite ten years old, but whom he on reasonable grounds believed to be a little more than ten, was to escape altogether. He could not, in that view of the statute, be convicted of the felony, for he did not know her to be under ten. He could not be convicted of the misdemeanor, because she was in fact not above the age of ten." In dissent, Brett J addressed the content of the common law excuse in detail, holding that Mr Prince's act was excused based on a foundation of criminal procedure that "a mistake of facts, on reasonable grounds, to the extent that if the facts were as believed the acts of the prisoner would make him guilty of no criminal offence at all, is an excuse"96. Earlier in his reasons, however, Brett J described the disqualification from the excuse in broader terms, saying that the belief, if true, meant that the acts of Mr Prince involved no criminal offence and "no act in respect of which any civil action could have ever been maintained against him"97. Denman J, in the majority, thought that the actions of Mr Prince were wrongful, and the excuse inapplicable, because the actions were a civil wrong98. Still more broadly, in the majority, Bramwell B (with whom seven other members of the Court agreed) saw Mr Prince's act as one that was morally wrong or "wrong in itself"99. The second early decision upon which counsel for Mr Bell focused in her submissions was the decision of the Court for Crown Cases Reserved in R v Tolson100, in which R v Prince was distinguished. In the case reserved in R v Tolson, Ms Tolson had been convicted of the offence of bigamy. The Court described how she had remarried only after desertion by her husband and also after having been informed, and honestly and reasonably believing, that her husband was dead. The conviction was quashed by majority, with R v Prince distinguished by four members of the majority on the basis that the "intention of the legislature" for the offence in that case was inconsistent with the existence of the excuse101. (1875) LR 2 CCR 154 at 170. (1875) LR 2 CCR 154 at 159. (1875) LR 2 CCR 154 at 179. (1875) LR 2 CCR 154 at 174, 175. 100 (1889) 23 QBD 168. 101 (1889) 23 QBD 168 at 180, 190-191. Edelman Gleeson By distinguishing R v Prince on the basis of the intention of the legislature, the availability of the excuse was made to depend upon a question of statutory interpretation, namely whether the particular provision had excluded the excuse. As Cave J said in R v Tolson, whether a defendant may be excused on the basis of an honest and reasonable belief is an "inference [that] necessarily arises from the language of the section"102. In other cases, where, unlike R v Tolson, it was inferred that the implication was not intended by Parliament, R v Prince was followed103. Although R v Prince was distinguished in R v Tolson on the basis that the legislation considered in R v Tolson did not disclose any parliamentary intention to exclude the common law excuse, Stephen J (with whom Grantham J agreed) nevertheless qualified the excuse by a requirement that the honest and reasonable belief must be such that "if the facts were as believed, the acts of the prisoner would make [them] guilty of no offence at all"104. Wills J (with whom Charles J agreed) described the qualification even more broadly as one "to do a thing wrong in itself and apart from positive law, or it may be to do a thing merely prohibited by statute or by common law"105. The broadest approach to a qualification upon the excuse was taken in another of the majority judgments in R v Tolson106, that of Cave J (with whom Day and A L Smith JJ concurred), who described the common law excuse as one in which the honest and reasonable belief, if true, "would make the act ... an innocent act", distinguishing the decision in R v Prince on the basis that the honest and reasonable belief of Mr Prince, if true, would not have been innocent because it would have involved an immoral, although lawful, act. The different approach in the Criminal Codes Section 24(1) of the Criminal Code in Queensland, which is materially the same as the first paragraph of s 24 of the Criminal Code in Western Australia, provides that a person who "does or omits to do an act under an honest and reasonable, but mistaken, belief in the existence of any state of things is not 102 (1889) 23 QBD 168 at 182. 103 R v Forde [1923] 2 KB 400; Maughan (1934) 24 Cr App R 130. 104 (1889) 23 QBD 168 at 190. 105 (1889) 23 QBD 168 at 172. 106 (1889) 23 QBD 168 at 181. Edelman Gleeson criminally responsible for the act or omission to any greater extent than if the real state of things had been such as the person believed to exist". It has occasionally been suggested that the common law doctrine should also operate so that an accused person is "deemed to have acted under that state of facts which [they] in good faith and on reasonable grounds believed to exist when [they] did the act alleged to be an offence"107, or that the Criminal Code (Qld) reflected that common law "with complete accuracy"108. In a marginal note to the draft provision which became s 24 of the Criminal Code (Qld), Sir Samuel Griffith wrote "Common Law"109, perhaps reflecting the view that the provision adopted the deeming approach taken in the Digest of Sir James Fitzjames Stephen and that author's view of the common law in the late-nineteenth century110. Despite the helpful and detailed submissions of the Solicitor-General of the State of Queensland on this appeal, it is unnecessary to consider the scope of the honest and reasonable mistake excuse in the Criminal Codes of Queensland and Western Australia. The reason it is unnecessary to do so is that it was common ground on this appeal that the excuse under the Criminal Codes is not the same as it is under the common law111, and no party or intervener submitted that the common law should develop so as to align with the literal meaning of s 24 of the Criminal Code in Queensland and Western Australia112. Indeed, it might even be doubted whether the common law could develop an excuse in the terms of s 24, which would involve an offender being deemed to have committed a different offence whose elements were not, in fact, satisfied. For instance, there must be doubt as to whether, in circumstances such as those contemplated in R v Prince, 107 R v Tolson (1889) 23 QBD 168 at 188. See also Stephen, A Digest of the Criminal Law, 3rd ed (1883) at 26. 108 Thomas v The King (1937) 59 CLR 279 at 305-306. 109 Griffith, Draft of a Code of Criminal Law (1897) at 13. See also at xiv. 110 Stephen, A Digest of the Criminal Law, 3rd ed (1883) at 26. See CTM v The Queen (2008) 236 CLR 440 at 445 [3]. See also the possible influence of the Italian Penal Code 1889, Art 52. 111 See Anderson v Nystrom [1941] St R Qd 56 at 70. See also Australia, Review of Interim Report: Principles of Criminal Commonwealth Criminal Law, Responsibility and Other Matters (1990) at 69 [7.9]. 112 cf Stephen, A Digest of the Criminal Law, 3rd ed (1883) at 28, illustration 8 and Bergin v Stack (1953) 88 CLR 248 at 263. Edelman Gleeson an accused person could be deemed by the common law to have committed a statutory offence of sexually assaulting a child required by statute to be between the ages of 10 and 12 years, when the child's age was not, in fact, within that range. "Innocence" in the honest and reasonable mistake excuse The component of "innocence" in the definition of the honest and reasonable mistake excuse by Cave J in R v Tolson113 – a belief which, if true, "would make the act ... an innocent act" – has been reiterated in many cases subsequently, including repeatedly in this Court114. It is thoroughly entrenched as an element of the common law excuse of honest and reasonable mistake. But the precise meaning of the requirement of "innocence" has been the subject of different approaches. There are four approaches that can be discerned from the authorities, particularly those discussed above. From the narrowest to the broadest approaches they are as follows. An act will only be innocent if: the facts as honestly and reasonably believed would involve no moral or legal culpability; the facts as honestly and reasonably believed would not constitute any offence or legal wrong (including torts); the facts as honestly and reasonably believed would not constitute any offence; or the facts as honestly and reasonably believed would not constitute the offence charged. 113 (1889) 23 QBD 168 at 181. 114 See Bank of New South Wales v Piper [1897] AC 383 at 389-390; Maher v Musson (1934) 52 CLR 100 at 104; Thomas v The King (1937) 59 CLR 279 at 304-305; Proudman v Dayman (1941) 67 CLR 536 at 540; Bergin v Stack (1953) 88 CLR 248 at 262; R v Reynhoudt (1962) 107 CLR 381 at 385-386, 391, 399-400, 404; Iannella v French (1968) 119 CLR 84 at 110; He Kaw Teh v The Queen (1985) 157 CLR 523 at 550-551, 558-559, 572-573, 590; CTM v The Queen (2008) 236 CLR 440 at 445 Edelman Gleeson The first and second approaches: Innocent of moral culpability or civil wrongdoing One or other of the first two approaches – disqualifying from the excuse an accused person whose mistaken belief, if true, would make their act immoral or a civil wrong – was adopted by a number of the judges in R v Prince and R v Tolson. But neither of these approaches was ever widely accepted in subsequent cases. In some early decisions, the excuse was described without any reference to morality or by rejecting the relevance of immoral conduct that is not unlawful115. In others, judges expressly avoided deciding whether the excuse should be denied if the act is immoral but not criminal116. Either the first or second approach was countenanced in Bergin v Stack117. In that case, Mr Stack was convicted of an offence of selling liquor without a licence contrary to s 161 of the Licensing Act 1928 (Vic). On appeal to this Court by the Inspector of Police from the quashing of that conviction, one issue was whether Mr Stack had an excuse of honest and reasonable mistake of fact. This Court held that the elements of the offence contained in s 161 did not expressly or impliedly require Mr Stack to know that the club in which he had sold liquor lacked a licence118. But it was assumed, albeit doubted by Fullagar J119 and rejected by Kitto J120, that s 161 included, by implication, the excuse of honest and reasonable mistake of fact. On the question of whether the excuse applied, in reasons with which Williams A-CJ and Taylor J agreed, Fullagar J referred to R v Prince as requiring that "the fact believed was such that, if it had been true, there would not merely have been no crime at all but no wrongful act at all"121. Whether, by Fullagar J's reference to a "wrongful act", his Honour was contemplating the first approach (extending to any immorality or legal wrong) or 115 R v Green and Bates (1862) 3 F & F 274 at 274-275 [176 ER 123 at 123]; R v Hibbert (1869) LR 1 CCR 184 at 185. 116 R v Tolson (1889) 23 QBD 168 at 181-182. 117 (1953) 88 CLR 248. 118 (1953) 88 CLR 248 at 254, 260. 119 (1953) 88 CLR 248 at 261. 120 (1953) 88 CLR 248 at 273. 121 (1953) 88 CLR 248 at 262. Edelman Gleeson the second approach (extending only to legal wrongs), there had been no argument about the different possibilities. And the reasons for the rejection of the excuse by Fullagar J could have satisfied any of the first three approaches. One of Mr Stack's asserted beliefs was that he did not know that the club was unlicensed. Putting to one side whether the excuse requires a positive belief or whether tacit beliefs or ignorance can suffice, it was held by Fullagar J that even if the club had been licensed Mr Stack would have been guilty of another offence, namely an offence of the same nature under s 266(2) of selling liquor in any club during prohibited hours122. Neither of the first two approaches should be accepted. In He Kaw Teh v The Queen123, Brennan J correctly rejected any role for civil wrongdoing or immorality, noting that criminal punishment is "not imposed to enforce the civil law, to deter the commission of torts or to suppress immorality". Moreover, as Professor Kenny observed, these approaches substitute "the vagueness of an ethical standard for the precision of a legal one"124. An example of the wide scope of application of that vague standard, even by the social mores of the time125, is the reasoning of Bramwell B in R v Prince that to take a female "of such tender years", whether or not she was over 16 years, from the care of her parents was "wrong in itself". Professor Cross described this language as "gross judicial hyperbole", citing the example of a male friend who took a consenting 18-year-old female "against her parents' wishes on a short visit to his mother"126. The third and fourth approaches: Innocent of any offence or innocent of the offence charged Counsel for Mr Bell submitted that the fourth approach should be adopted, with the relevant qualification upon the excuse being that the honest and reasonable belief cannot amount to one which would involve guilt of the offence charged. That submission is inconsistent with the rejection of the excuse in Bergin v Stack. Counsel for Mr Bell thus submitted that the decision of this Court in 122 (1953) 88 CLR 248 at 263. 123 (1985) 157 CLR 523 at 588. 124 Kenny, Outlines of Criminal Law, 7th ed (1915) at 42. 125 See, eg, Holmes, The Common Law (1881) at 58-59, recognising that the conduct might be excused in some circumstances. 126 Cross, "Centenary Reflections on Prince's Case" (1975) 91 Law Quarterly Review Edelman Gleeson Bergin v Stack took a "step backwards" by following R v Prince and that Bergin v Stack should be either confined to regulatory offences or overturned. To the extent that Bergin v Stack adopted at least a requirement for the excuse that the acts of an accused person, on the facts as believed, could not amount to another offence, Bergin v Stack did not take a step backwards by following R v Prince. Bergin v Stack was correctly reasoned insofar as Mr Stack could not rely upon the excuse of honest and reasonable mistake because any belief that the club was licensed would simply have meant that he had committed a different offence. Indeed, Mr Bell's submission to the contrary would require rejection of the "knock-out argument" in R v Prince, by which a sexual assault upon a child under the age of 10 years would be excused if the accused person honestly and reasonably believed the child to be a little over the age of 10 years. Whilst it might be argued that the extreme consequence in R v Prince could be avoided by a drafting technique that created a general offence of sexual assault against all children under the age of 16 years, Parliaments have relied at least upon the excuse involving a belief that does not amount to another offence in the drafting of subsequent legislation. For instance, in relation to the very example given in R v Prince, s 66C of the Crimes Act 1900 (NSW), considered in CTM v The Queen127, provided in broad terms for offences of: sexual intercourse with a person aged between 10 and 14 years; sexual intercourse with a person aged between 10 and 14 years in circumstances of aggravation; and sexual intercourse with a person aged between 14 and 16 years. As Gleeson CJ, Gummow, Crennan and Kiefel JJ explained in CTM v The Queen128, it would "not assist an accused to believe that a child was aged between ten and fourteen, or between fourteen and sixteen; for if the child were of that age, it would merely take the case out of one prohibition into another". Moreover, it is not merely peculiarities of legislative drafting that lead to the absurdity of treating as excused an act that, on the facts as the accused person believed them to be, would so obviously be an offence of a similar nature. In Bergin v Stack129, another example was given by Fullagar J. For an offence of burglary after 9 pm, could a burglar be excused from the offence on the ground that they honestly and reasonably believed the time to be before 9 pm? Or, as 127 (2008) 236 CLR 440. 128 (2008) 236 CLR 440 at 453 [27]. 129 (1953) 88 CLR 248 at 263. Edelman Gleeson Dr Kenny had also said in the course of originally giving this example130, could the burglar be excused on the ground that they honestly and reasonably believed that the house was No 6 rather than No 5 as charged in the indictment? Closer still to the facts of the present appeal are cases where it has been held that on a charge of assaulting a police officer it is not open for the accused person to be excused on the basis that they did not know that the victim was a police officer131. Even with an honest and reasonable belief that the victim is not a police officer, the act would still constitute the offence of assault. As Dixon CJ said of an offence involving an assault upon "any member of the police force in the due execution of [their] duty"132: "a defendant might set up honest and reasonable mistake but the facts in which [they] honestly and reasonably believed must be such as would make [their] act innocent, eg a justification of the assault". A complete excuse thus denies responsibility for the consequences of the criminal acts based on reasons for thinking that the acts were justified although, in fact, they were not133. It would be self-contradictory for a legal system to conclude, at the same time, that the acts of an accused person, on the facts believed by that person, would be an offence, and also that the actions of the accused person should be entirely excused based on that belief134. 130 Kenny, Outlines of Criminal Law (1902) at 65. Kenny was himself adapting the example from Bramwell B in R v Prince (1875) LR 2 CCR 154 at 176. 131 R v Forbes and Webb (1865) 10 Cox Cr Cases 362. See also R v Prince (1875) LR 2 CCR 154 at 176. 132 R v Reynhoudt (1962) 107 CLR 381 at 385-386. See also at 389, "facts which, if they had existed, would have made what [they] did to the police officer no assault at all" (Kitto J). 133 Gardner, Offences and Defences: Selected Essays in the Philosophy of Criminal Law (2007) at 86, 131. See also Austin, "A Plea for Excuses: The Presidential Address" (1956) 57 Proceedings of the Aristotelian Society 1 at 2. 134 cf s 24 of the Criminal Codes of Queensland and Western Australia, above at Edelman Gleeson Limits to the third approach The most recent enunciation of the excuse of honest and reasonable mistake by this Court was in terms of the third approach, requiring the belief to be one that, if true, would have meant that the accused person was guilty of no offence. In CTM v The Queen135, Gleeson CJ, Gummow, Crennan and Kiefel JJ said: "Where it is a ground of exculpation, the law in Australia requires that the honest and reasonable, but mistaken, belief be in a state of affairs such that, if the belief were correct, the conduct of the accused would be innocent. In that context, the word 'innocent' means not guilty of a criminal offence. In the case of an offence, or a series of offences, defined by statute, it means that, if the belief were true, the conduct of the accused would be 'outside the operation of the enactment'." The reference by their Honours to the offence falling "outside the operation of the enactment" is a quotation from Dixon J in Proudman v Dayman136. The need for the accused person's belief not to be outside the "operation of the enactment" introduces a limit upon the circumstances in which the excuse can be excluded from consideration because the person's belief might amount to an offence. For the reasons below, that limit is based upon the accusatorial system of criminal justice. The common law requires that an accused person is entitled to be told "not only of the legal nature of the offence with which he or she is charged, but also of the particular act, matter or thing alleged as the foundation of the charge"137 and the manner in which the offence was alleged to have been committed138. As Barwick CJ said in Ratten v The Queen139, approving reasons given by the Full Court of the Supreme Court of Victoria: "'Under our law a criminal trial is not, and does not purport to be, an examination and assessment of all the information and evidence that exists, 135 (2008) 236 CLR 440 at 447 [8] (footnote omitted). 136 (1941) 67 CLR 536 at 541. 137 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 557 [26]. See also Johnson v Miller (1937) 59 CLR 467 at 489. 138 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 557 [26]. See also John L Pty Ltd v Attorney-General (NSW) (1987) 163 CLR 508 at 519. 139 (1974) 131 CLR 510 at 517, quoting Re Ratten [1974] VR 201 at 214. Edelman Gleeson bearing on the question of guilt or innocence'. It is a trial, not an inquisition". It would be contrary to these longstanding common law assumptions underlying the accusatorial criminal justice system for the prosecution, during the course of a trial, to be permitted to conduct a trial within a trial as to whether the acts of the accused person constitute a different and uncharged offence, beyond the scope of the enactment as charged, and perhaps based upon new facts that might be disputed. In other words, the limit requires that whenever sufficient evidence is led to enliven a consideration of the excuse of honest and reasonable mistake, the prosecution must negate that excuse unless the prosecution can establish, consistently with the right of the accused person to be informed of the foundation of the charges against them, that the acts of that person would constitute another offence based upon the facts they believed. This point can be illustrated by adapting an example given in a report of the Criminal Law Officers Committee of the Standing Committee of Attorneys-General140, which followed the Committee's consideration of Proudman v Dayman. Suppose that a person accused of importing heroin were to lead evidence in support of an excuse that they honestly and reasonably believed that they were importing watches. Separately from any questions concerning the mental element required for the offence, the prosecution could not avoid its onus to negate the excuse of honest and reasonable mistake by seeking to establish that the belief of the accused person amounted to a different offence, involving new evidence and allegations outside the scope of the enactment, to show that the watches that were the subject of the belief were dutiable and that the accused did not have a licence to import them. It is unnecessary in this case to explore the metes and bounds of this limit. It was not an issue in Bergin v Stack. And many cases will be simple. For instance, on a charge of sexual assault, it is consistent with an accusatorial system of criminal justice for the excuse to be unavailable in the circumstances discussed in R v Prince and CTM v The Queen. No excuse is available based on an erroneous belief as to the age of a child whom the accused is charged with having sexually assaulted, where the belief, if true, would involve an offence of the same nature. And, as set out above, the excuse has correctly been held to be unavailable where the alleged erroneous belief included a lack of knowledge that the person was a police officer, although the acts nevertheless constituted an assault. 140 Criminal Law Officers Committee of the Standing Committee of Attorneys-General, Model Criminal Code, Chapters 1 and 2: General Principles of Criminal Responsibility – Report (1992) at 53-55 [307]. Edelman Gleeson There was equally no denial to Mr Bell of the basic protections of the accusatorial criminal justice system by the refusal of the trial judge at Mr Bell's first trial to leave to the jury the question of whether any offence committed by Mr Bell under s 14 of the Misuse of Drugs Act would be excused by an honest and reasonable mistake. If the facts as to the complainant's age alleged to have been believed by Mr Bell had been true, then the same evidence in respect of the offence for which he was charged would have unequivocally established that Mr Bell would have been guilty of the offence under s 26 of supplying a controlled drug to another person. No uncharged fact or matter is involved in that conclusion. Conclusion Unlike any expressed or implied requirements for a particular element of an offence, the common law excuse of honest and reasonable mistake of fact operates to excuse the whole of the acts of an accused person from the charged offence. Mr Bell's alleged honest and reasonable belief that the complainant was 18 years or older could not have excused the entirety of his acts, which, even if the facts he believed were true, would have involved the offence of supplying a controlled drug to another person. The trial judge properly did not instruct the jury that this excuse needed to be negated by the prosecution and the Court of Criminal Appeal of the Supreme Court of Tasmania correctly dismissed the appeal. This does not mean that any honest and reasonable belief concerning a strict liability element of the offence is irrelevant if the belief is of facts that would constitute an offence. The belief could still be a matter relevant to sentencing141. As it turned out, however, in the context of the sexual assault charge the second jury rejected Mr Bell's claim that such a belief was honestly and reasonably held. 141 See CTM v The Queen (2008) 236 CLR 440 at 453 [27].

HIGH COURT OF AUSTRALIA AND FAZARRI APPELLANT RESPONDENT [2020] HCA 35 Date of Hearing: 7 August 2020 Date of Judgment: 14 October 2020 ORDER Appeal dismissed with costs. On appeal from the Family Court of Australia Representation A J Myers QC with M C Hines and S J Moloney for the appellant (instructed by Armstrong Legal) B W Walker SC with A M Dinelli and N A Wootton for the respondent (instructed by Taussig Cherrie Fildes) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Family law – Property settlements – Where respondent husband made gift to appellant wife of ten per cent interest in residential dwelling ("the property") – Where respondent subsequently signed transfer of land giving appellant further 40 per cent interest in the property – Where parties registered as joint tenants then executed deed of gift providing for payment to appellant's siblings if appellant predeceased respondent while they remained joint tenants – Where parties subsequently married then separated after 23 days – Where each party sought orders under s 79(1) of Family Law Act 1975 (Cth) altering interests in property of marriage ("property settlement orders") – Where appellant did not appear at trial so matter proceeded as undefended hearing – Whether primary judge failed to take existing legal and equitable interests of parties into account for purposes of s 79(1) of Family Law Act – Whether primary judge's approach to deed of gift amounted to failure to take material consideration into account – Whether open to primary judge to determine that making of property settlement orders was just and equitable – Whether open to primary judge to assess that appellant made ten per cent financial contribution to acquisition of the property – Whether Full Court of the Family Court of Australia erred in refusing to exercise discretion conferred by s 93A(2) of Family Law Act to receive further evidence on appeal. Words and phrases – "affirmation", "deed of gift", "demands of justice", "duress", "finality", "financial contribution", "further evidence on appeal", "joint tenants", "just and equitable", "malpractice", "pressure", "property settlement order", "ratification", "unconscionable conduct", "undue influence", "voidable". Family Law Act 1975 (Cth), ss 75(2), 79, 93A(2), 94(1). Family Law Rules 2004 (Cth), rr 1.04, 1.08. KIEFEL CJ, BELL AND KEANE JJ. Prior to their marriage, the respondent husband made a gift to the appellant wife of a ten per cent interest in a residential dwelling ("the property"). Around eight months later, while in hospital receiving treatment for a suspected heart attack, the respondent, under pressure from the appellant, signed a transfer of land1 ("the transfer"), giving her a further 40 per cent interest in the property. A little over two months later, at a time when the respondent was no longer under pressure, the transfer was registered and the parties became proprietors of the property as joint tenants. Shortly thereafter, they executed a deed of gift ("the deed") which provided for the respondent to pay a sum, approximately one half of the value of the property, to the appellant's siblings in the event that she predeceased him while they remained joint tenants. In August 2016, the parties married. The marriage lasted 23 days. Thereafter each party sought orders under s 79(1) of the Family Law Act 1975 (Cth) ("the Act"), altering their interests in property. The appellant did not appear at the hearing and the matter proceeded as an undefended hearing in the Family Court of Australia (Cronin J). On 19 June 2018, the Court made orders, relevantly: severing the joint tenancy of the property; requiring the appellant to transfer the whole of her interest in the property to the respondent; requiring the respondent to pay the appellant $100,000; and that each party otherwise retain all other property in the possession of the party at the date of the orders. An appeal to the Full Court of the Family Court of Australia (Strickland, Kent and Watts JJ) was dismissed. By special leave granted by Nettle and Gordon JJ on 10 October 2019, the appellant appeals from the orders of the Full Court on eight grounds. The first five grounds variously contend that the Full Court erred in upholding the property settlement order either because it was not open to the primary judge to be satisfied that it was just and equitable to make it2 or because the primary judge's discretion miscarried by reason of his Honour's failure to take account of the appellant's 50 per cent legal interest in the property. In the written submissions filed on the appellant's behalf, these five grounds were distilled to a single issue, namely whether the gift of the additional 40 per cent interest in the property was voidable for undue influence (or pressure, as the primary judge described it), or whether the gift had become absolute by virtue of the deed ("the first issue"). The Full Court's error was said to be that it accepted the finding that the respondent signed the transfer under pressure without Transfer of Land Act 1958 (Vic), s 45(1). 2 Family Law Act 1975 (Cth), s 79(2). Bell considering whether the effect of the pressure was spent by the execution of the deed. At the hearing in this Court, there was a shift in the way the argument was put on the first issue. Contrary to the suggestion that the primary judge treated the gift of the 40 per cent interest as having been set aside for undue influence, it was accepted that his Honour approached the determination on the footing that the appellant was a joint tenant of the property. The significance of the deed was not that it affirmed the joint tenancy but rather that it evidenced the parties' intentions with respect to the very events that had occurred. Their agreement – that should they separate or divorce the appellant's interest in the property should be reflected in a payment to her by the respondent of a sum equivalent to half of its value – was a material consideration which the primary judge had failed to take into account. As will appear, the argument is based on a misconstruction of the deed. The appellant's challenge under her first five grounds reduces to the contention that it was not open to the primary judge to be satisfied that it was just and equitable to make a property settlement order or, if it was, it was not open to find the appellant's financial contribution was no greater than ten per cent. Neither proposition should be accepted. The remaining three grounds contend error in the Full Court's refusal to exercise the discretion conferred by s 93A(2) of the Act to receive further evidence on the appeal ("the second issue"). The further evidence is said to reveal malpractice on the respondent's part arising from his failure to disclose materials that reveal either that his evidence was false or that he practised a fraud on the revenue. As will appear, in circumstances in which the appellant made a deliberate choice not to participate in the trial and not to adduce the further evidence which was available to her, the Full Court was right to decline to receive it on the appeal. For the reasons to be given, the appeal should be dismissed with costs. The procedural history In this Court, the appellant does not challenge the primary judge's determination to proceed with the hearing in her absence. Nonetheless, in light of her argument on the second issue – that the demands of justice required the Full Court to admit the further evidence and direct a new trial so that she would have the opportunity of putting her case – reference should be made to aspects of the procedural history. In November 2016, the respondent commenced proceedings in the Federal Circuit Court of Australia seeking orders under s 79(1) of the Act to alter the parties' interests in property by transferring the appellant's interest in the property to him. By her amended response to the application, the appellant also sought an Bell order under s 79(1) of the Act, altering the parties' interests in property by transferring 50 per cent of the respondent's assets to her. On 19 September 2017, the proceedings were transferred to the Family Court. In December 2017, the parties were offered a date for final hearing. The appellant opposed that course. Before the proceedings were transferred, the appellant had applied for interlocutory orders, including that the respondent pay her a sum of $200,000 to be applied towards her legal costs and disbursements of the proceedings. In January 2018, the appellant's application came before the primary judge. His Honour took into account that the appellant had already spent in excess of $200,000 on legal expenses in connection with the proceedings3. His Honour was satisfied that there were circumstances justifying a departure from the principle that each party bear its own costs4. In the absence of evidence as to the estimated amount of the appellant's costs, his Honour determined that the respondent should pay the appellant $80,000 to enable her to investigate the sufficiency of the respondent's discovery, deal with an outstanding issue of spousal maintenance and, if necessary, consider mediation5. His Honour observed that the case was one that needed to be managed and controlled, noting that the appellant could make a further application and justify the need for any additional funds6. In April 2018, on the application of the respondent and over the opposition of the appellant, the matter was fixed for trial. Directions appointing a timetable for the filing of affidavits were given. These required that the appellant file her evidence by 6 June 2018. She failed to do so. On 7 June 2018, her solicitors filed a notice of ceasing to act. On 14 June 2018, the day before the trial, the appellant applied for orders that the trial be adjourned to a date to be fixed and for the recusal of the primary judge. The appellant appeared for herself and read what the primary judge described as "significant affidavits" that had been prepared in support of the applications7. The primary judge described the appellant as "an educated and 3 Fazarri & Hsiao [2018] FamCA 1159 at [12]. 4 Family Law Act, s 117; Fazarri & Hsiao [2018] FamCA 1159 at [29]. 5 Fazarri & Hsiao [2018] FamCA 1159 at [31], [34]. 6 Fazarri & Hsiao [2018] FamCA 1159 at [31]. 7 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [12]. Bell intelligent woman who was more than capable of arguing her case"8. His Honour noted the absence of any explanation as to why the appellant's solicitors had not prepared the matter for trial or, if they perceived any insufficiency in the respondent's discovery or litigation funding, why they had not pursued those matters9. Both applications were refused. Thereupon the appellant stated that she could not attend the hearing on the following day. The primary judge warned the appellant that in such an event the trial might proceed in her absence10. The appellant did not attend the Court the following day. The primary judge found that there was no acceptable reason for her failure to file evidence or to appear11. The matter proceeded as an undefended hearing. The factual findings In summary, the factual findings were as follows. At the date of the trial, the appellant was aged 44 years and the respondent was aged 58 years. Their intimate relationship began in August 2012 at a time when the respondent was residing with his former wife. In March 2013, following his separation from his former wife, the respondent rented premises. Thereafter, he and the appellant spent nights together at each other's homes. While the parties lived together for intermittent periods they did not form a de facto relationship. Throughout their relationship and short marriage they maintained separate residences. travelled The respondent internationally and the appellant often accompanied him, fulfilling a limited role as a personal assistant. She did not otherwise support the respondent's career and her attendance at social events was rare. The appellant was not engaged in paid employment during the parties' relationship and marriage. During the relationship, the parties unsuccessfully attempted to have a child. The appellant received various benefits from the respondent: access to his bank and credit card facilities; having her expenses paid; being made a beneficiary of a family trust; receiving a contribution of $20,000 to her superannuation fund; and being given a new motor vehicle. In 2015, the appellant took $40,000 from an account controlled by the respondent without his authority. 8 Fazarri & Hsiao [2018] FamCA 446 at [37]. Fazarri & Hsiao [2018] FamCA 446 at [85]. 10 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [8]. 11 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [11], [17]. Bell At the beginning of their relationship, the respondent had assets of approximately $20,000,000, which were subsequently reduced to around $9,000,000 following a property settlement with his former wife. The appellant had minimal assets, comprising a motor vehicle and some superannuation. In April 2014, the respondent purchased the property for $2,200,000, which was financed from the respondent's own funds and borrowings. The parties had not lived together, in the sense of having a committed relationship, at the time of the purchase of the property. Simultaneously with the settlement of the property the respondent gifted to the appellant a one tenth interest in the property. The parties were registered as the proprietors of the property, as tenants in common, with the respondent holding nine of the ten undivided shares. At the time of its acquisition, the property was not habitable. The respondent subsequently paid for renovations to the property, but at the date of the trial neither party had resided there. On 15 December 2014, while the respondent was in hospital suffering from a suspected heart attack, under pressure from the appellant he signed the transfer. On 27 February 2015, the transfer was registered and the parties became proprietors of the property as joint tenants. In March 2015, the parties executed the deed. On 22 August 2016, they married and on 12 September 2016 they separated. By September of that year, the respondent had expended around $43,000 on renovations to the property. At the date of the trial, the property was valued at $3,070,000. The deed The deed was entitled "DEED OF GIFT" and after naming the respondent and the appellant as the parties to it, relevantly the deed provided: "DEFINITIONS The Property The property known as [G Street]. [The appellant's brother] [The appellant's sister] Bell The Gift The sum of one million Australian dollars ($1,000,000.00) INTRODUCTION [The respondent] and [the appellant] are currently the registered proprietors of the Property by way of joint tenancy. In the event that [the appellant] predeceases [the respondent], [the respondent] intends to make a gift of one million Australian dollars ($1,000,000.00) to [the appellant's brother] and [the appellant's sister] in equal parts so that they receive $500,000 each. NOW THIS DEED WITNESSES AS FOLLOWS In the event [the appellant] predeceases [the respondent], and the parties still own the Property as joint tenants, the parties agree and acknowledge that sole ownership of the Property will devolve to [the respondent] as the survivor and the terms of this Deed will apply. In these circumstances, the parties agree that [the respondent] will pay the Gift to [the appellant's brother] and [the appellant's sister] in equal parts of $500,000 each. [The respondent] agrees to make payment of the Gift to [the appellant's brother] and [the appellant's sister] within sixty (60) days of the date of [the appellant's] death. [The respondent] agrees to pay the whole or part of the Gift to such trust or trusts nominated by [the appellant's brother] or [the appellant] at least 14 days before payment of the Gift. In the event that [the appellant's brother] predeceases [the appellant], [the respondent] will pay the Gift to [the appellant's sister]. Unless a trustee is otherwise appointed by [the appellant] or [the appellant's brother] under clause 4, the money is to be paid to [the appellant's sister] in whole to the exclusion of any other party, including her legal guardian or carer. In the event that [the appellant's sister] predeceases [the appellant], [the respondent] will pay the total Gift to [the appellant's brother]. The parties agree that this Deed will have no application in the event that: Bell The Parties do not own the Property as joint tenants as at the date of [the appellant's] death; or [the respondent] predeceases [the appellant]. 8.(a) If the parties are separated or divorced and the Property is still owned by the parties as joint tenants, any property settlement or Family Court proceedings will take into account any payment made or to be made under this Deed by [the respondent]. The payment under 8(a) will be: $1 million, if [the appellant] and [the respondent] have any children together which [the respondent] is supporting financially whether part of any settlement or court proceedings or otherwise; or half the value of the Property with a minimum of $1 million if [the respondent] and [the appellant] do not have any children, and such payment will be taken into account as part of the Property Settlement or Court proceedings. This clause 8 is intended to apply where the parties have separated or divorced and [the appellant] predeceases [the respondent] before a final property settlement is agreed or determined. It is not intended that [the respondent] pays twice under this Deed and then under any property settlement or proceedings." The primary judge's analysis The primary judge approached the parties' respective applications to alter their interests in property correctly by first determining what those interests were. His Honour noted that neither the fact of the marriage nor its ending carried with it an assumption that those interests should be adjusted12. It was the respondent's case that as he had provided all of the funds to acquire the property it was open to find that the appellant's legal interest was 12 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [75]-[76], citing Stanford v Stanford (2012) 247 CLR 108 at 121 [39] per French CJ, Hayne, Kiefel and Bell JJ. Bell subject to a resulting trust for his benefit. The primary judge disposed of the submission shortly, observing that, putting aside the "constraints" thrown up by the presumption of advancement, a resulting trust could only arise in relation to the appellant's one tenth interest that had been created when the property was acquired13. And his Honour was satisfied that the appellant received her one tenth interest as a gift14. Turning to the balance of the appellant's interest in the property, his Honour accepted that the respondent had been "badgered" by the appellant to give her an additional 40 per cent interest15. Nonetheless, the inference that his Honour drew from the creation of the joint tenancy was that the respondent intended that the appellant be the owner of the whole undivided interest in the property with him and that she become sole proprietor in the event that he predeceased her16. There was no evidence that the respondent had done anything other than to comply with the appellant's demands for equality of ownership and it was difficult to see any trust arising in his favour17. His Honour found that at the time of the property's acquisition, the parties intended that theirs would be a lasting relationship and that the property would be the place in which they shared their lives18. The lack of fulfilment of this expectation was the circumstance that satisfied his Honour that it was just and equitable to make a property settlement order19. His Honour acknowledged the obligation that the respondent had assumed under the deed to make the payment to the appellant's siblings in the event that she predeceased him20. Clause 7(a) provided that the deed would have no application 13 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [52]. 14 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [49], [51]. 15 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [52]. 16 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [52]. 17 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [52]. 18 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [76]. 19 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [78]. 20 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [54]. Bell in the event that the parties no longer owned the property as joint tenants as at the date of the appellant's death, and each party was seeking orders that would sever the joint tenancy21. In the circumstances, his Honour found it unnecessary to give further attention to the deed. In considering what, if any, orders should be made for the alteration of the parties' property interests it was necessary for his Honour to take into account the factors set out in s 79(4), which include the matters set out in s 75(2) so far as they are relevant22. The s 79(4) factors included the financial and non-financial contributions made directly or indirectly by the parties to the acquisition, conservation or improvement of any of their property23, the contribution that each made to the welfare of the family24 and the effect of any proposed order upon the earning capacity of either party25. His Honour observed that this was "a short marriage of days and the relationship as a whole, [was] modest"26. His Honour assessed the appellant's non- financial contribution to the acquisition, conservation or improvement of their property to be modest, if not nominal27. His Honour was not satisfied that the marriage had had any effect on the earning capacity of the appellant28. Section 75(2)(o) required the Court to consider "any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account". His Honour approached the determination upon a view that this requirement operates to relieve the Court of being confined "to strict contributions 21 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [57], [99]. 22 Family Law Act, s 79(4)(e). 23 Family Law Act, s 79(4)(a), (b). 24 Family Law Act, s 79(4)(c). 25 Family Law Act, s 79(4)(d). 26 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [103]. 27 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [67]. 28 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [103]. Bell of the nature described in s 79(4)"29. In circumstances in which the appellant had received her initial ten per cent interest in the property as a gift, his Honour rejected the respondent's submission that it was just to hold that "as he paid for the item in the first place, on strict contribution lines, he should have it back"30. His Honour assessed the appellant as having made a ten per cent financial contribution to the acquisition of the property31. The respondent's financial contribution to the acquisition, conservation or improvement of the property of the parties to the marriage as a whole was overwhelmingly greater than that of the appellant. In light of the appellant's conduct of the litigation, his Honour considered it appropriate to take into account, against any entitlement that she might otherwise have, the respondent's payment of $80,000 towards her legal costs32. Given that the purchase of the property was funded in part by the respondent's borrowing and that it had been renovated at his expense, the primary judge considered that the appellant's financial contribution to the property was less than $220,00033. The effect of the primary judge's orders was to leave the appellant with assets of $430,000 and the respondent with assets in excess of $12,000,00034. The Full Court's analysis Application to adduce further evidence Before the Full Court, the appellant sought to adduce further evidence in the form of three affidavits affirmed by her and filed on 20 November 2018, 27 November 2018 and 6 December 201835. Documents exhibited to these affidavits were described by the Full Court as falling within one of four categories. 29 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [92], citing Gabel v Yardley (2008) 40 Fam LR 66 at 81 [72] per Bryant CJ and Coleman J. 30 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [86]. 31 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [88]. 32 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [93]. 33 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [105]. 34 Hsiao & Fazarri [2019] FamCAFC 37 at [15]. 35 Hsiao & Fazarri [2019] FamCAFC 37 at [16], [18]. Bell The first category comprised documents relating to whether the respondent was under pressure when he signed the transfer of the 40 per cent interest in the property to the appellant, and whether he subsequently acquiesced in the transfer. The second category comprised documents relating to whether the parties were living together on a genuine domestic basis before their marriage. The third category comprised documents relating to whether documents in the first and second categories were required to have been discovered by the respondent. The fourth category comprised documents relating to the appellant's failure to appear at the trial. The Full Court found that, with the exception of a medical certificate dated 26 June 2018, all the documents comprising the further evidence were in the appellant's possession, or could have been obtained by her, before the trial. Their Honours found that reception of the documents in the first and second categories would have required a new trial36. In light of the primary judge's finding that the respondent had made the overwhelming financial contribution to the acquisition, conservation and improvement of the property during a short relationship and a very short marriage, the Full Court considered that the appellant's focus on the circumstances in which she obtained the further 40 per cent interest and her focus on the execution of the deed were distractions37. None of the documents in the first or second categories, in the Full Court's assessment, demonstrated error in the orders below, nor would they have produced a different Given that the appellant had, or had access to, all of the documents in the first and second categories, the Full Court did not stay to determine whether the respondent had complied with his discovery obligations39. The medical certificate dated 26 June 2018 stated that the appellant had been "bed bound due to pelvic pain and migraines from Friday 8 June 2018 until Friday 15 June 2018"40. The Full Court noted that the appellant had appeared on her own behalf on the hearing of her interlocutory applications from 10.53 am to 4.16 pm on 14 June 2018. 36 Hsiao & Fazarri [2019] FamCAFC 37 at [25], [37]. 37 Hsiao & Fazarri [2019] FamCAFC 37 at [29]. 38 Hsiao & Fazarri [2019] FamCAFC 37 at [30], [37]. 39 Hsiao & Fazarri [2019] FamCAFC 37 at [39]. 40 Hsiao & Fazarri [2019] FamCAFC 37 at [41]. Bell The acknowledgment that the appellant had had the opportunity to file the further material before the trial and that she had deliberately refrained from doing so was held to weigh heavily against its reception on the appeal41. Their Honours held that it was not in the interests of justice to receive the further evidence. The treatment of the appellant's interest in the property Among her remaining grounds in the Full Court, the appellant challenged the primary judge's finding that the transfer of the property to the parties as joint tenants was not to be seen as a gift because she had pressured the respondent at a time when he was vulnerable. The finding was said to fail to take into account the respondent's "ratification and confirmation of that transfer by the terms of the deed" and the inference from its terms that, in the case of separation or divorce, the appellant was to receive the fair value of her interest. The Full Court rejected the ground, noting the primary judge's express reference to the deed and his Honour's conclusions with respect to the parties' contributions to the acquisition, conservation and improvement of the property42. The Full Court also rejected a ground that contended that the finding of the respondent's overwhelming financial contribution failed to take into account the appellant's 50 per cent legal interest in the property. Their Honours noted that the primary judge had clearly taken into account the legal ownership of the property at the date of the trial43. A further ground contended that the primary judge failed to take into account that the property settlement order deprived the appellant of the benefit of the deed without giving her any compensation. The Full Court noted that both parties sought orders severing the joint tenancy. Their Honours said the primary judge was right to observe that the effect of the orders to be made would be that the deed was at an end44. The Full Court dismissed as incompetent unparticularised grounds that asserted, first, that there was no basis upon which the Court could be 41 Hsiao & Fazarri [2019] FamCAFC 37 at [47], citing CDJ v VAJ (1998) 197 CLR 172 at 203 [116] per McHugh, Gummow and Callinan JJ. 42 Hsiao & Fazarri [2019] FamCAFC 37 at [70]-[73]. 43 Hsiao & Fazarri [2019] FamCAFC 37 at [76]. 44 Hsiao & Fazarri [2019] FamCAFC 37 at [80], [84]. Bell satisfied that it was just and equitable to make the property settlement order and, secondly, that the primary judge's discretion under s 79 had miscarried45. The argument in this Court on the further evidence It is convenient to deal at the outset with the appellant's ground which challenges the Full Court's refusal to receive the further evidence. The focus in this Court was on two documents, which were suggested to cast doubt on the respondent's credit and to demonstrate that he had engaged in "malpractice" in the conduct of his case at trial. Both documents were enclosed with a letter written to the respondent by his solicitor on 9 December 2014. The first was the transfer and the second was a Form 9A issued by the State Revenue Office of Victoria ("the SRO") to enable applications to claim exemptions from the payment of duty on the transfer of land from one spouse or domestic partner to another46. The solicitor asked the respondent to arrange for the appellant to sign both documents in the presence of a witness. Both documents were otherwise complete. The transfer recorded the consideration for the transfer of the respondent's 40 per cent interest in the property as "[t]he Natural Love and Affection the first named Transferor has for his domestic partner being the second named Transferee". The appellant signed the Form 9A on 15 December 2014. It contained the following declaration: "I am the domestic partner of the transferor listed above. Although we are not married to each other we are domestic partners of each other and are living together as a couple on a genuine domestic basis (irrespective of gender)". One inference is that the respondent's solicitor, acting on the respondent's instructions, arranged for the lodgement of the Form 9A with the SRO. The appellant submitted that the Full Court erred in failing to take into account the respondent's failure to disclose the further evidence to the primary judge. It was said that either the respondent's evidence, that he and the appellant had not lived together, was contradicted by representations that they had which were made on his behalf to the SRO, or those representations were made in support of a deliberately false application for exemption from duty. 45 Hsiao & Fazarri [2019] FamCAFC 37 at [86]-[87]. 46 Duties Act 2000 (Vic), s 43. Bell The appellant submitted that the respondent's non-disclosure of the transfer and the Form 9A amounted to malpractice. The Full Court's error, in this analysis, lay in not recognising that the interests of justice favour the exposure of malpractice. The Full Court's focus on whether the further evidence might have produced a different result in the circumstances was said to have been misplaced47. In any event, the appellant submitted, the Full Court was wrong not to find that there was a real possibility that there would have been a different result had the further evidence been before the primary judge48. With the benefit of the further evidence, it was submitted, the primary judge was unlikely to have accepted the respondent's evidence either that he had been pressured into transferring the further 40 per cent interest in the property or as to the nature and extent of the relationship. The refusal to receive the further evidence left the primary judge's findings, including that the respondent's disclosure had been adequate, standing. In the appellant's submission, the respondent's failure to disclose the further evidence, particularly the transfer and the Form 9A, occasioned a miscarriage of justice warranting a re-trial so that she might have the opportunity of putting her case. The discretion to receive fresh evidence The discretion that s 93A(2) confers on the Full Court to receive further evidence on an appeal exists to serve the demands of justice49. Against the background of the procedural history set out above, the appellant's submission, that those demands favour exposure of the respondent's asserted malpractice so that she may have the opportunity to put her case, is distinctly unattractive. Not later than when the respondent filed his evidence prior to trial the appellant may be taken to have understood its significance to her case. At that time the appellant was in possession of the further evidence or in a position to obtain it – significantly, a copy of the transfer was annexed to an affidavit filed in relation to the costs of the proceedings before the primary judge. The trial was the opportunity for the appellant to put her case and the appellant chose not to participate in it. The main purpose of the Family Law Rules 2004 (Cth) is "to ensure that each case is resolved in a just and timely manner at a cost to the parties and the 47 See Clone Pty Ltd v Players Pty Ltd (In liq) (Receivers and Managers Appointed) (2018) 264 CLR 165 at 190-191 [50]. 48 Commonwealth Bank of Australia v Quade (1991) 178 CLR 134 at 142-143. 49 CDJ v VAJ (1998) 197 CLR 172 at 202 [111] per McHugh, Gummow and Bell court that is reasonable in the circumstances of the case"50. Parties to proceedings under the Act are under an obligation to act in a manner that conduces to the promotion and achievement of that purpose51. Nonetheless, it is recognised that in proceedings under the Act, the need for finality will often be less prominent than in other appellate proceedings. Among other considerations, this takes into account the fact that proceedings under the Act will often affect the interests of children and that in many cases the Full Court is able to act on further evidence without the need for a new trial52. This is not to hold that in a case such as the present – property settlement proceedings following a notably short marriage that do not involve the interests of children – the need for finality does not present as a most material factor53. Here the respondent had no opportunity to deal with the further evidence and its reception would have necessitated a new trial. The Full Court's exercise of discretion was correct; the demands of justice would not have been served by receiving further evidence that would have necessitated a new trial in order to give the appellant an opportunity to present a case that she deliberately chose not to make at trial. That is so regardless of whether the further evidence might have produced a different result, albeit the Full Court's conclusion that it would not has not been shown to be erroneous. Correct approach to making a property settlement order disregarded or misunderstood? On the hearing in this Court, the appellant acknowledged that the primary judge's determination, that it was just and equitable to alter the parties' interests in property, proceeded on acceptance that they were joint tenants54. In the circumstances, the appellant's argument accepted that there was no question of the deed operating to affirm the joint tenancy. Her complaint with the primary judge's 50 Family Law Rules 2004 (Cth), r 1.04. 51 Family Law Rules, r 1.08. 52 CDJ v VAJ (1998) 197 CLR 172 at 200 [104], 202 [111] per McHugh, Gummow 53 CDJ v VAJ (1998) 197 CLR 172 at 203 [116] per McHugh, Gummow and 54 Stanford v Stanford (2012) 247 CLR 108 at 120-123 [35]-[46] per French CJ, Hayne, Kiefel and Bell JJ. Bell treatment of the deed was his Honour's failure to refer, much less accord weight, to the provision made under it in cl 8. In particular, cl 8(b)(ii) was suggested to address the very circumstances that had occurred: the parties remained joint tenants of the property, they were separated or divorced, and they did not have any children. Clause 8(b)(ii) was a "powerful statement of the parties' intention and expectation" that in such an event the appellant's interest in the property would be reflected by the payment to her of a sum representing half of its value, being a sum not less than $1,000,000. The argument acknowledged that the deed was not a "financial agreement" for the purposes of the Act55 but maintained that its provisions were plainly material to any assessment of whether it was just and equitable to alter the parties' interests in the property. The deed was executed in March 2015, not long after the transfer was registered and the parties became the proprietors of the property as joint tenants. The evident intention of the parties in executing the deed was to address the consequences of survivorship in the event that the appellant predeceased the respondent. It was a deed of gift in favour of the appellant's brother and sister (or the survivor of the brother and sister). Clauses 1 to 6 provided for payment of the gift, as defined, in the event that the appellant predeceased the respondent at a time when the marriage was on foot. Clause 7 made clear that the deed had no application in the event that the parties no longer owned the property as joint tenants at the date of the appellant's death, or in the event that the respondent predeceased the appellant. Clause 8 needs to be understood in light of the fact that the Act permits property settlement proceedings to be continued by or against the legal personal representative of a deceased party to a marriage56. The evident purpose of cl 8 is to make provision in the event the appellant predeceased the respondent at a time when they were separated or divorced and before any property settlement proceedings between them were completed. Clause 8(c) states so. Contrary to the appellant's submission, cl 8(b)(ii) cannot be construed as providing for the respondent to pay to the appellant a sum representing half the value of the property in the event of their separation or divorce if they remained its owners as joint tenants. The only payments for which the deed provided were to the appellant's brother and sister (or the survivor of the brother and sister), or to a trustee 55 Family Law Act, s 71A. 56 Family Law Act, s 79(8)(a). Bell nominated by the appellant or her brother, in circumstances in which the appellant was deceased. The execution of the deed remains central to the appellant's challenge. The deed, executed at a time when there was no suggestion that the respondent was under pressure, was premised on the appellant's 50 per cent interest in the property being preserved for the benefit of her siblings in the event of her death, including at a time when she and the respondent were separated or divorced. Why, she asks, is it just and equitable for the Court to disturb the parties' interests in the property without making reference to what they had themselves agreed? The primary judge appreciated the necessity of identifying the parties' existing legal and equitable interests in property before determining whether it was just and equitable to make orders, as each party had invited the Court to do, altering those interests57. This was a brief marriage, which was not shown to have affected the appellant's earning capacity. There were no children whose interests stood to be affected by any alteration of the parties' interests in property. In the circumstances, arguments may be envisaged for and against finding that it was just and equitable to make a property settlement order. In the event, the arguments pressed on the appellant's behalf in this Court were not put to the primary judge and his Honour cannot be criticised for not addressing them. The lack of fulfilment of the parties' expectations that their marriage would be lasting, and that the property would serve as the place in which to share their lives, was the consideration which his Honour found made it just and equitable to make a property settlement order. Accepting that it was open so to reason, the fact that shortly after becoming registered as joint tenants of the property the parties executed the deed to protect the appellant's interests in the event that she predeceased the respondent provides no reason to come to a different conclusion. His Honour's discretion did not miscarry by reason of his failure expressly to advert to the significance of cl 8 of the deed, especially given that cl 8 did not contemplate the making of a payment to the appellant under any circumstances. Further, both parties were seeking relief, the granting of which, as his Honour appreciated58, would necessitate the severance of the joint tenancy, the 57 Stanford v Stanford (2012) 247 CLR 108 at 120-123 [35]-[46] per French CJ, Hayne, Kiefel and Bell JJ. 58 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [57], [99]. Bell continuation of which was a condition of the operation of cl 8. Clause 8, properly understood, had no bearing upon the proper exercise of his Honour's discretion. Another way in which the appellant's argument was put was to challenge the basis for the distinction that his Honour drew between the initial gift of the ten per cent interest in the property and the subsequent transfer of the 40 per cent interest. His Honour distinguished the transfer from the initial gift on the basis that the latter was, at best, done at the appellant's "insistence" while the former was done under "pressure" from her59. This distinction was drawn in the context of assessing the direct and indirect financial contribution, if any, made by the appellant to the acquisition, conservation and improvement of any of the property of the parties to the marriage60. His Honour's conclusion that, unlike the transfer of the 40 per cent interest, the initial gift should be treated as a financial contribution to the acquisition of the property, notwithstanding that the respondent paid the whole of the purchase price61, reflected his Honour's assessment of the justice of the case. Implicit in the analysis, in the context of this short marriage, is his Honour's further assessment that the justice of the case did not warrant treating the appellant as having made a financial contribution of 50 per cent to the acquisition, conservation and improvement of the property. His Honour is not to be taken to task for not making a close examination of the facts to determine whether the transfer of the 40 per cent interest was voidable by reason of vitiating factors such as duress, undue influence or unconscionable conduct. His Honour made no such finding. Nor is his Honour to be taken to task for failing to give more comprehensive reasons for the distinction drawn between the appellant's acquisition of the initial ten per cent interest and subsequent acquisition of the additional 40 per cent interest in the property in assessing the parties' respective direct and indirect financial contributions. His Honour's reasons reflected the arguments that were put to him. The trial was the place to adduce such evidence and put such arguments as might favour a different finding as to the parties' respective financial contributions for the purposes of s 79(4)(a). The trial was not some preliminary skirmish which the appellant was at liberty to choose 59 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [84]-[85]. 60 Family Law Act, s 79(4)(a). 61 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [88]. Bell not to participate in without consequence62. Her right of appeal63 was a right to have the Full Court review whether the primary judge's discretion to make a property settlement order had miscarried, applying the well-established principles expressed in House v The King64. It was not an opportunity for the appellant to make a case that she chose not to make at the trial. The Court is invested with a wide discretion under s 79(1) to make such order as it considers appropriate65. It should not be concluded that his Honour's assessment of the parties' respective financial contributions, in this singular case, was not open. Order For these reasons there will be the following order: Appeal dismissed with costs. 62 Coulton v Holcombe (1986) 162 CLR 1 at 7 per Gibbs CJ, Wilson, Brennan and 63 Family Law Act, s 94(1). (1936) 55 CLR 499 at 504-505 per Dixon, Evatt and McTiernan JJ; see also Norbis v Norbis (1986) 161 CLR 513 at 517-519 per Mason and Deane JJ. 65 Mallet v Mallet (1984) 156 CLR 605 at 608 per Gibbs CJ. NettleJ NETTLE AND GORDON JJ. We have had the advantage of reading in draft the reasons for judgment of the majority, but we have come to a different conclusion. We do not agree that the primary judge approached the matter, or that the appellant ever accepted that the primary judge approached the matter, on the footing that the appellant was a joint tenant of the property the subject of the present appeal ("the property"). As will be seen, the primary judge treated the appellant's interest as a joint tenant in the property as in effect abrogated by "pressure". But, as will be explained, it was not open on the evidence to find "pressure" sufficient to vitiate the appellant's interest as joint tenant, and, in any event, the vitiating effect of such "pressure" as there may have been was negated by the respondent's subsequent execution of the deed of gift ("the deed"). As a result, the primary judge failed to give proper effect to the existing legal and equitable interests of the parties66. And the appellant maintained throughout the proceedings in this Court that that was her case. How the appellant approached the matter As is explained in the majority's reasons, the appellant did not appear at the trial and it was conducted in her absence. Consequently, it may well be said that she bears a considerable degree of responsibility for the way in which the matter miscarried. But, as was her right67, she appealed to the Full Court on grounds of appeal which included, relevantly, that the primary judge incorrectly concluded that the appellant placed pressure on the respondent to transfer an additional 40 per cent interest in the property to her, because the primary judge failed to take into account: that there was no evidence capable of sustaining a finding that the transfer could not be seen as a gift; the [respondent's] evidence that during [the] relationship, he acceded to the [appellant's] every demand, in which case it was unlikely that any pressure was a cause of his signing the transfer; [the respondent's] acquiescence in the transfer and his ratification and confirmation of that transfer by the terms of the deed under seal". 66 As is required by s 79 of the Family Law Act 1975 (Cth), in accordance with the principles set out in Stanford v Stanford (2012) 247 CLR 108 at 120-121 [36]-[40] per French CJ, Hayne, Kiefel and Bell JJ. 67 Family Law Act, s 94(1). NettleJ The Full Court rejected grounds (a) and (b) as follows68: "In respect of contention a), there was evidence from the respondent capable of sustaining a finding that the transfer of 40 per cent could not be seen as a gift ... There is no basis for contention b), that the primary judge failed to take into account the respondent's evidence that he acceded to the appellant's every demand ... when concluding that the appellant pressured the respondent at a vulnerable time." The Full Court rejected ground (c) on the basis that69: "There is no basis to suggest that the primary judge failed to take the deed into account when making findings about what had happened when the respondent signed the transfer in December 2014." The appellant then appealed to this Court on grounds which included, as her first and principal ground of appeal, that: "The Full Court erred in holding that the circumstances in which the appellant obtained an additional 40% legal interest in [the property] and the Deed of Gift signed by the appellant and respondent in about March 2015 were distractions in the disposition of the appeal." Likewise, in the appellant's amended written submissions filed some months in advance of the hearing of the appeal before this Court, it was stated that: "The first issue, which arises under s 79 of the Family Law Act 1975 ... has two parts. The first part is the question whether the respondent's gift to the appellant making her a joint tenant of [the property] was voidable or not. The second part is whether the property settlement order made by the primary Court, by which her interest in the property was transferred to the respondent, should have been upheld." (emphasis added) Later in the same submissions, the appellant contended that the Full Court failed to identify the existing legal and equitable interests: "32. The correct approach to be taken to the analysis of the first issue described ... was set out by this Court in Stanford v Stanford (2012) 247 CLR 108. The Court said that first, it is necessary to begin consideration of whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law 68 Hsiao & Fazarri [2019] FamCAFC 37 at [66] per Strickland, Kent and Watts JJ. 69 Hsiao & Fazarri [2019] FamCAFC 37 at [72] per Strickland, Kent and Watts JJ. NettleJ and equitable principles, the existing legal and equitable interests of the parties in the property. That required the Court below to decide whether the appellant's joint tenancy was voidable because procured by undue influence (or pressure, as the primary Court and the Court below described it), or had become absolute by virtue of the deed. 34. What the Court below did was merely to accept the primary Court's finding of pressure, without embarking on the enquiry whether the effect of any pressure was spent by the coming into operation of the deed. The deed defined the property and referred to the parties and their joint tenancy. It provided for a gift of $1 million by the respondent to the brother and sister of the appellant in case she should predecease the respondent. Evidently, this was intended to be some sort of compensation to the appellant should the respondent, as the survivor, take the whole property. The terms of the deed provided that if the parties were separated or divorced, any property settlement would take into account any payment of the $1 million gift. Relevantly, the deed contemplated that the appellant would not lose her interest in the property by reason of the parties' separation or divorce. Even if, as the Court below apparently accepted, the appellant had pressured the respondent to such an extent as to render her joint tenancy voidable, it is thus apparent that the respondent made an election to affirm it. This being so, when and after the property proceedings commenced, the gift of the tenancy was no longer voidable (if it ever had been), and the appellant's joint tenancy was not liable to be set aside. Having regard to the deed, this was the only finding open. Thus, the Court below failed to undertake the first step required in beginning its consideration of whether it was just and equitable to make the property settlement order depriving the appellant of her joint tenancy. The question is, considering that the appellant's interest was not one vitiated by pressure (and so not voidable), whether or not there was any principled reason for depriving her of its value." (emphasis in original, footnotes omitted) NettleJ Submissions to substantially the same effect were also advanced in the appellant's outline of oral argument handed up shortly before the commencement of the hearing of the appeal to this Court: The approach of the Trial Judge, approved by the Full Court, is flawed for at least the following reasons: It is not clear that, as a first step, the legal and equitable interests of the parties to the marriage were identified. The Appellant was a joint tenant of the Property when the parties married and at the date of trial. The Trial Judge obscured the position by suggesting that the joint tenancy transfer 'could not be seen as a gift' ... and referred to 'the issue of the interest she contributed in [the property]' ... In determining whether to make an order under section 79, the Trial Judge did not take into account the Appellant's interest as joint tenant of the Property ... The Full Court approved the Trial Judge's findings b) When the Court has identified the property of the parties to the marriage, section 79(2) requires that the Court must only make any order altering the interests of the parties to the marriage in the property, including an order for a settlement of property in substitution for any interest in the property, if the Court is satisfied it is 'just and equitable in the circumstances'. As is clear from Stanford ... this requires more than an assessment of 'contributions to the acquisition, conservation and improvements of [the property]' ... The provisions of the Deed of Gift are important. First, the Deed of Gift, in relation to which there is no suggestion of pressure, is a clear affirmation of the transfer. Second, the provisions of the Deed of Gift provide that the gift constituted by the transfer is for the benefit of the Appellant, notwithstanding separation or divorce. In the circumstances, the Court below cannot have been satisfied that it was just and equitable to make an order depriving the Appellant of her interest in the Property without an order providing for payment to her of a sum of money equal to its value. The Full Court ... mentioned that the Deed of Gift was not an agreement under section 71A and observed that the 'primary judge was not bound' by the terms of the Deed of Gift ... Although not bound by the Deed of Gift, consideration of the Deed of Gift was of primary importance for the Trial Judge NettleJ in making the determination whether or not to exercise the power under section 79. The Full Court also remarked that, in any event, 'given the applications each party has made for final orders, clause 7 provided that the Deed of Gift has no application' ... This observation is simply wrong. Clause 7 does not address the state of affairs which was before the Family Court." (italics and underlining in original) When counsel for the appellant began his oral submissions before this Court, he stated that the appellant was no longer seeking 50 per cent of the current value of the property but only half the value of the property at the date of trial less the $100,000 awarded by the primary judge. Having then briefly outlined some of the facts, he observed that it appeared from the respondent's outline of oral argument that the respondent no longer contended that the appellant had not been entitled legally and beneficially to her interest in the property as joint tenant. And, as counsel for the appellant obviously appreciated, that was a remarkable concession on the part of the respondent, given that, both at first instance and on appeal to the Full Court, the respondent had argued, successfully, that the transfer of the property to the appellant as joint tenant could not be considered a gift because it was made under pressure. Hence, the observation of counsel for the appellant in his submissions before this Court that, in light of this concession, "whatever is the significance of the suggestion that [the transfer] was not a gift, it is not a consequence [of it being something other than a gift] that there was not a joint tenancy". Counsel for the appellant later turned to the decision of the Full Court and the holding of this Court in Stanford v Stanford and concluded that section of his argument with this: "My friend concedes today that there was a joint tenancy, and indeed the judge did so. But the fact that there was a gift made does not affect the nature of the joint tenancy. The starting point of the judge's consideration should have been an unequivocal statement that there was a joint tenancy created by the gift, not simply to call into some sort of question whether the gift was freely given. Second, the court identified the property of the parties to the marriage but when it has done so, it requires that the court must only make an order altering the interests of the parties of the marriage and the property, including an order for the settlement of the property in substitution for any interest in the property, if the court is satisfied that it is 'just and equitable' in the circumstances. Well, in the present case, in considering that question of whether something is just and equitable, the deed of gift should have been carefully NettleJ considered by the court. It was not considered by the judge at first instance, and the [Full Court] simply said the judge was aware of the deed of gift and that was sufficient. It is not sufficient ... that the deed of gift is based on the assumption that in the circumstances with which it deals, the [appellant's] interest as a joint tenant will be preserved in some sense, either by a payment of money or otherwise, including in the circumstances of Family Court proceedings. That is what the parties agreed among themselves. Why is it just and equitable that the court should disturb that without expressly referring to what the parties themselves agreed?" (emphasis added) Counsel for the respondent argued in response that while the respondent now conceded that the transfer was not vitiated by pressure and that "there was a joint tenancy ... a joint tenancy legally and beneficially", there was no reason to doubt that the matter had been dealt with at first instance and on appeal in the exercise of the discretion created by s 79 consistently with the requirements set out by the plurality in Stanford v Stanford. Primary judge's failure to identify the existing interests of the parties As the decision of this Court in Stanford v Stanford makes plain, the starting point in the determination of what is "just and equitable" for the purposes of s 79 of the Family Law Act is the determination, according to ordinary legal and equitable principles, of the existing legal and equitable interests of the parties in the property that is to be settled70. So much follows from the text of s 79(1)(a) of the Family Law Act itself, which refers to altering the interests of the parties71. But just as importantly, it is the statutory imperative to take into account the considerations stipulated by the legislature, including, critically, the existing interests of the parties, that characterises the power conferred by s 79 as judicial power72. Consequently, proper consideration of existing interests is of fundamental importance. In the present case, the primary judge failed to identify or give effect to the existing interests of the parties in a critical respect. (2012) 247 CLR 108 at 120-121 [36]-[40] per French CJ, Hayne, Kiefel and Bell JJ. 71 Stanford v Stanford (2012) 247 CLR 108 at 120 [37] per French CJ, Hayne, Kiefel 72 See Sanders v Sanders (1967) 116 CLR 366 at 379-380 per Windeyer J; Cominos v Cominos (1972) 127 CLR 588 at 594-595 per Walsh J, 598-600 per Gibbs J, 602-606 per Stephen J, 608 per Mason J. NettleJ The primary judge's findings of fact are set out in the majority's reasons for judgment and it is unnecessary to repeat them. It suffices to emphasise for present purposes the primary judge's conclusions73 that, although "the relationship [between the appellant and the respondent] was an intimate one", it was "hardly one that would satisfy the criteria for a de facto relationship"; that, in relation to the property, "the [respondent] was badgered by the [appellant] to give her 40 per cent of his interest [sic]"; and that, because the respondent "was under pressure and ... not in a position to argue", "the 10 per cent interest could not be seen in the same light as the 40 per cent" (emphasis added). The primary judge found74 that the appellant had a 10 per cent interest as tenant in common in the property that the respondent had given her at the time of the acquisition of the property in April 2014. Thus, as his Honour stated75, "it is difficult ... to see how [the respondent] can simply ignore the creation of the 10 per cent interest in the first place because that was not anything other than deliberate even if he did it under the [appellant's] 'insistence'". Consistently with Stanford v Stanford, the primary judge took the appellant's 10 per cent interest in the property into account in deciding how the parties' respective interests in the property should be adjusted76. The primary judge also found77 that the appellant's interest in the property was increased, with effect from 27 February 2015, from a 10 per cent share as tenant in common to, effectively, a 50 per cent interest as joint tenant, by the appellant and the respondent executing and, later, registering, in consideration of "natural love and affection", a transfer of the property from themselves as tenants in common to themselves as joint tenants. But, in contrast to the way that the primary judge gave full effect to the appellant's 10 per cent interest in the property in the application of s 79, his Honour treated the increase of 40 per cent to the interest as joint tenant as something that should not be taken into account in arriving at a just and equitable outcome under s 79, because, his Honour said78: 73 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [39], [52], [84] per Cronin J. 74 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [49] per Cronin J. 75 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [52] per Cronin J. 76 See Fazarri & Hsiao [No 2] [2018] FamCA 447 at [76]-[90] per Cronin J. 77 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [52] per Cronin J. 78 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [51] per Cronin J. NettleJ the [appellant] asked "Having acquired [the property], the [respondent] to increase her interest to 50 per cent and that occurred although in controversial circumstances. He said that whilst in hospital with a suspected heart attack, the [appellant] demanded he sign a transfer and he did. The title was altered from 27 February 2015. Unlike the 10 per cent, this could not be seen as a gift because of the circumstances under which it arose. I accept the [respondent's] unchallenged evidence that the [appellant] pressured him at a vulnerable time." (emphasis added) As this Court has previously stated79, in a case where a transaction is sought to be impugned by the operation of vitiating factors such as duress, undue influence, or unconscionable conduct, it is necessary for a trial judge to conduct a "close consideration of the facts ... in order to determine whether a claim to relief has been established". Here, however, as counsel for the appellant submitted before this Court, it is not at all apparent why his Honour considered that the facts as found meant that the appellant's 40 per cent interest in the property should either at law or in equity be conceived of as ineffective. There is nothing in the facts as found or elsewhere in his Honour's reasons that suggests that the appellant exerted any improper pressure by making unlawful80 or lawful81 threats, or that she was capable of subjecting or subjected the respondent to any recognisable form of improper economic pressure82. Perhaps, his Honour conceived of the case as one of undue influence of such effect as to overbear the respondent's independence and voluntariness of free will83, or of unconscionable conduct constituted of the appellant taking unconscientious advantage of the respondent's found state of disability the result of being hospitalised for a suspected heart attack84. But his 79 Thorne v Kennedy (2017) 263 CLR 85 at 104 [41] per Kiefel CJ, Bell, Gageler, Keane and Edelman JJ, quoting Kakavas v Crown Melbourne Ltd (2013) 250 CLR 392 at 400 [14] per French CJ, Hayne, Crennan, Kiefel, Bell, Gageler and Keane JJ. 80 cf Barton v Armstrong [1976] AC 104. 81 See and compare Tsarouhi & Tsarouhi [2009] FMCAfam 126. See also Thorne v Kennedy (2017) 263 CLR 85 at 114-115 [71]-[72] per Nettle J and authorities there cited. 82 cf Hawker Pacific Pty Ltd v Helicopter Charter Pty Ltd (1991) 22 NSWLR 298. 83 See and compare Johnson v Buttress (1936) 56 CLR 113 at 134 per Dixon J; Louth v Diprose (1992) 175 CLR 621 at 625-626 per Mason CJ; Thorne v Kennedy (2017) 263 CLR 85 at 99-100 [31]-[32] per Kiefel CJ, Bell, Gageler, Keane and Edelman JJ, 118-119 [83]-[87] per Gordon J. 84 See, eg, Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447. NettleJ Honour did not say so, and, contrary to the Full Court's conclusion, his Honour's findings certainly do not go far enough to sustain either conclusion. In those circumstances, to treat the appellant's 40 per cent interest in the property as not a gift, and thus as somehow to be disregarded in the settlement of property under s 79, was contrary to the need to recognise and adjust legal and equitable interests mandated by Stanford v Stanford, and was an error of law. Furthermore, even if the facts as found had been capable of sustaining a conclusion that the transfer creating the joint tenancy was vitiated by illegitimate pressure, undue influence or unconscionable conduct, in March 2015 – months after the respondent was released from hospital and without any suggestion of him any longer being "badgered" or "pressured ... at a vulnerable time" – the respondent and the appellant executed the deed, drawn up by the respondent's solicitor in accordance with the respondent's instructions. In the deed, the appellant and the respondent confirmed the appellant's interest in the property as joint tenant, and provided, inter alia, that if the appellant predeceased the respondent while the appellant and the respondent remained joint tenants, the respondent would pay the appellant's brother and sister a total of $1 million or, if the appellant and the respondent did not have any children together whom the respondent was then supporting, the greater of $1 million and half the value of the property. The deed further provided that: "If the parties are separated or divorced and [the property] is still owned by the parties as joint tenants, any property settlement or Family Court proceedings will take into account any payment made or to be made under this Deed by [the respondent]." The primary judge noticed the execution of the deed but deemed it to be of no consequence85: "Because of the orders I intend to make, the parties will immediately no longer own the property as joint tenants. I propose to sever the tenancy by the orders and that brings the application of the deed to an end." The deed, however, was of profound consequence, because, as Turner LJ famously observed86 in Wright v Vanderplank, in equity, where a transaction is 85 Fazarri & Hsiao [No 2] [2018] FamCA 447 at [57] per Cronin J. (1856) 8 De G M & G 133 at 146-147 [44 ER 340 at 345]. See also, eg, De Bussche v Alt (1878) 8 Ch D 286 at 314 per Thesiger LJ (James and Baggallay LJJ agreeing); Lamotte v Lamotte (1942) 42 SR (NSW) 99 at 103 per Roper J, citing Powell v NettleJ impeachable all that is required to render it unimpeachable is "proof of a fixed, deliberate and unbiassed determination that the transaction should not be impeached". Granted, an act may not have that effect unless the party concerned knows of his or her entitlement to seek to have the transaction impeached87, and, in the case of a transaction vitiated by undue influence, such an act of affirmation is only effective if committed after the undue influence has ceased88. But here the respondent knew of the nature and circumstances of execution of the transfer, which he argued below entitled him to have the transfer treated as nought; as the evidence disclosed, the respondent was a senior commercial partner of one of the largest and most prestigious firms of solicitors in the country; and the respondent had the added benefit of his own solicitor's advice in the preparation and execution of the deed89. In those circumstances, it cannot be doubted that the respondent fully appreciated the extent of his rights in equity to apply to have the transfer set aside as the product of "pressure"90; and, given the facts apparently thought to establish that the transfer was vitiated by excessive pressure related primarily to the facts surrounding the respondent's hospitalisation and associated sedation – rather than the respondent's evidence that he was emotionally dependent on the appellant – there is no evidentiary basis to conclude that any undue influence was continuing at the time the respondent and appellant executed the deed. Powell [1900] 1 Ch 243 at 245-246 per Farwell J; Avtex Airservices Pty Ltd v Bartsch (1992) 107 ALR 539 at 567 per Hill J. 87 Burrows v Walls (1855) 5 De G M & G 233 at 253 per Lord Cranworth LC [43 ER 859 at 867-868]; De Bussche v Alt (1878) 8 Ch D 286 at 314 per Thesiger LJ (James and Baggallay LJJ agreeing). 88 See Allcard v Skinner (1887) 36 Ch D 145 at 188-189 per Lindley LJ, 192 per Bowen LJ. 89 As to the relevance of independent advice to claims of undue influence, see generally Allcard v Skinner (1887) 36 Ch D 145 at 185 per Lindley LJ; In re Coomber; Coomber v Coomber [1911] 1 Ch 723 at 730 per Fletcher Moulton LJ (Buckley LJ agreeing); Kali Bakhsh Singh v Ram Gopal Singh (1913) 41 LR Ind App 23 at 31 per Lord Shaw of Dunfermline; Watkins v Combes (1922) 30 CLR 180 at 196-197 per Isaacs J; Royal Bank of Scotland Plc v Etridge [No 2] [2002] 2 AC 773 at 807-808 per Lord Nicholls of Birkenhead. 90 See Wright v Union Fidelity Trustee Co of Aust Ltd (unreported, Supreme Court of New South Wales, 1 October 1985) at 20-22 per Hodgson J; Franknelly Nominees Pty Ltd v Abrugiato (2013) 10 ASTLR 558 at 601-602 [232], 603 [243] per Buss JA. NettleJ It is, therefore, apparent, and should have been held by the primary judge, that the respondent had, by his execution of the deed (which ex facie was predicated on the efficacy of the transfer), ratified or adopted the transfer, and that he was thereafter precluded by his conduct from taking proceedings to have it set aside91. It was not open to the primary judge to treat the appellant's interest as a joint tenant in the property as in effect abrogated by "badgering" or "pressure". Errors of the Full Court As has been seen, the Full Court rejected the appellant's contention that the primary judge erred by treating the transfer as in effect set aside. Their Honours held that92: "The focus of the appellant's submissions, which were about the circumstances in which the appellant obtained the 40 per cent interest in [the property] and the Deed of Gift the parties signed in about March 2015, are distractions. What the primary judge was bound to do, as part of making a determination under s 79 of the Act, was to assess contributions to the acquisition, conservation and improvement of [the property]. The primary judge concluded that the appellant could only claim the most moderate non- financial contributions and that the respondent had made the overwhelming financial contributions to the acquisition, conservation and improvement of [the property] during a short relationship and a very short marriage. When considering s 79(4)(d)-(f), the primary judge was cognisant of the respondent's financial position and earning capacity as compared to those of the appellant. The primary judge made the property settlement order after considering the relevant evidence in light of the statutory requirements." (emphasis added) So to hold compounded the primary judge's error by decreeing that the circumstances surrounding the execution of the transfer, and thus in effect why the appellant's 40 per cent interest in the property should be regarded as not a gift, were a "distraction". That was erroneous in three respects. First, the existence of the appellant's 40 per cent interest in the property was not a "distraction". As was made clear in Stanford v Stanford, because that interest 91 See Wright v Vanderplank (1856) 8 De G M & G 133 at 146-147 per Turner LJ [44 ER 340 at 345]; De Bussche v Alt (1878) 8 Ch D 286 at 314 per Thesiger LJ (James and Baggallay LJJ agreeing); Allcard v Skinner (1887) 36 Ch D 145 at 188 per Lindley LJ, 192 per Bowen LJ; Heydon, Leeming and Turner, Meagher, Gummow and Lehane's Equity: Doctrines and Remedies, 5th ed (2015) at [37-030]-[37-035]. 92 Hsiao & Fazarri [2019] FamCAFC 37 at [29] per Strickland, Kent and Watts JJ. NettleJ was one of the existing legal and equitable interests of the parties in the property to be settled, it should have been front and centre – the very starting point – in the determination of what was "just and equitable" for the purposes of s 79. Secondly, although the parties' respective financial and non-financial contributions, financial positions and earning capacities were unquestionably relevant considerations in the adjustment of the parties' existing legal and equitable interests in the property to be settled, and although, for the sake of argument (but no more), it may be supposed that it would have been open to the primary judge to conclude on the basis of his Honour's assessment of the appellant's contributions to the aggregation of the property and otherwise that she should be stripped of her 50 per cent interest in the property in return for a payment of $100,000 (plus $80,000 that had been advanced on account of costs), that is not what his Honour did. As has already been explained, the primary judge excluded the appellant's 40 per cent interest in the property from consideration as something other than a gift because it was the product of "badgering" and "pressure". Just as it is necessary for a trial judge closely to scrutinise the facts to determine whether it is open to find that a transaction has been vitiated by duress, undue influence, or unconscionable conduct, so too must an appellate court closely scrutinise the trial judge's findings and (subject to bearing in mind the advantages enjoyed by the trial judge) assess any challenge to the trial judge's conclusions in light of those facts and the applicable legal and equitable principles93. The Full Court erred in their failure to do so. Thirdly, it is altogether unrealistic to suppose that the primary judge could have arrived at the same conclusion, or made the same orders, if his Honour had not treated the appellant's 40 per cent interest in the property as something other than a gift and therefore as such to be excluded from consideration94. For even allowing for the primary judge's assessment of the exiguousness of the appellant's financial and other contributions, which the Full Court so much emphasised, what justice and equity could there be in stripping the appellant of the totality of her 50 per cent legal and beneficial interest in the property and conferring it on the respondent, who, on the evidence, was an extremely wealthy man with assets worth more than $9 million, in return for a payment to the appellant of $100,000 and $80,000 for legal costs previously advanced? To the contrary, assuming the propriety of the value of contributions relative to value of total assets which found favour with the primary judge and was endorsed by the Full Court, if the primary 93 Thorne v Kennedy (2017) 263 CLR 85 at 104 [41] per Kiefel CJ, Bell, Gageler, 94 See and compare House v The King (1936) 55 CLR 499 at 504-505 per Dixon, Evatt NettleJ judge had taken the appellant's 40 per cent interest into account, rather than treating her as having no more than a 10 per cent interest, his Honour should logically have awarded the appellant approximately five times what she recovered. Conclusion It follows in our view that the appeal should be allowed. It should be ordered that the orders of the Full Court made on 5 March 2019 be set aside, and, in their place, it be ordered that the appeal to the Full Court be allowed with costs, the orders of the primary judge made on 19 June and 29 October 2018 be set aside, and the matter be remitted to the primary judge for further determination according to law. The respondent should pay the appellant's costs of the appeal to this Court.

HIGH COURT OF AUSTRALIA APPELLANT AND WOOLWORTHS (Q'LAND) PTY LIMITED RESPONDENT Thompson v Woolworths (Q'land) Pty Limited [2005] HCA 19 21 April 2005 ORDER Appeal allowed with costs. Set aside orders 2 and 3 of the orders of the Court of Appeal of the Supreme Court of Queensland made on 12 December 2003 and in their place order that judgment be entered for the appellant in the sum of Respondent to pay the appellant's costs of the proceedings in the District Court of Queensland. On appeal from the Supreme Court of Queensland Representation: B W Walker SC with M E Eliadis for the appellant (instructed by Shine Roche McGowan) J A Griffin QC with M T O'Sullivan for the respondent (instructed by Blake Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Thompson v Woolworths (Q'land) Pty Limited Negligence – Duty of care – Independent contractor delivering goods in pursuit of mutual commercial purpose – Delivery person suffered back injury attempting to move industrial waste bins blocking supermarket loading dock – Content of duty to exercise reasonable care for safety of entrants – Consideration of aspects of relationship between occupier and entrant. Negligence – Contributory negligence – Independent contractor – Relevance of failure to wait for assistance before attempting to move bins – Relevance of knowledge of previous injury. GLEESON CJ, McHUGH, KIRBY, HAYNE AND HEYDON JJ. In an action brought in the District Court of Queensland, and heard by Samios DCJ, the appellant, who sustained a back injury while delivering goods to the respondent's store at Stanthorpe, sued the respondent for damages for negligence. She succeeded, and was awarded damages of $157,991.89. An allegation of By majority (de Jersey CJ and Williams JA; McMurdo J dissenting) the Court of Appeal of Queensland reversed the primary judge's finding of negligence and ordered that there be judgment for the defendant in the action2. The dissenting judge would have upheld the finding of negligence but reduced the judgment by one-third on account of contributory negligence. The primary question in this appeal is whether the Court of Appeal was justified in reversing the primary judge's finding of negligence. There is also a question as to contributory negligence. The facts The appellant's action arose out of an occurrence in late August 1999. She was unable to identify the precise date. She made no complaint to any employee of the respondent on the day. She first sought medical attention about three weeks later. The appellant had previously injured her back, in another work- related incident, a week or two before the events with which this case is concerned. Both injuries aggravated a pre-existing degenerative condition. The appellant suffered the injury the subject of this appeal while she was on premises occupied by the respondent. However, the case is not simply concerned with an occupier's liability for hazards associated with the static condition of premises. The appellant was on the respondent's premises for a mutual commercial purpose, and was required to conform to certain systems and procedures established by the respondent. The case concerns those systems and procedures, and the risks they involved for persons in the position of the appellant. It is, therefore, necessary to explain the context in which the injury occurred. The appellant and her husband conducted a bread delivery service in the Stanthorpe area pursuant to a contract with Cobbity Farm Bakeries Pty Ltd. They used two vehicles. The appellant's husband drove a van, and delivered 1 Thompson v Woolworths [2003] QDC 152. 2 Thompson v Woolworths (Q'land) Pty Ltd [2003] QCA 551. McHugh Kirby Hayne mainly to small retailers. The appellant drove a truck. She made daily deliveries to Woolworths' Stanthorpe store. She delivered at some time between 5 am and 5.30 am. The respondent's store was part of a shopping centre complex. Deliveries were made to a loading dock at the end of a lane. The loading dock led to a storeroom which was under the control of a storeman. There was a roller door between the loading dock and the storeroom. The appellant, like other deliverers of supplies, would reverse her truck along the laneway, and unload her goods onto the loading dock, from where they were taken to the storeroom. The respondent's storeman was necessarily involved in that process, for the purpose of agreeing upon the quantities delivered, and, no doubt, seeing that they were appropriately stored. The checking of quantities was done on the loading dock. The storeman was often, but not always, in or around the storeroom or loading dock area when the appellant arrived. Sometimes he was elsewhere, and it was necessary to press a buzzer to attract his attention and bring him to the loading dock. On some occasions it took up to 10 or 15 minutes for the storeman to arrive. The appellant could not unload her bread and depart to do her other deliveries without the presence and co-operation of the storeman. Sometimes the appellant's would be the first of the delivery vehicles to arrive at Woolworths; sometimes others would arrive there before her. If she arrived first, the lane was not wide enough to permit another vehicle to take her place. The appellant was a small woman. Her husband frequently went to Woolworths after doing his first delivery in order to help her unload her truck. Occasionally, he arrived at Woolworths for that purpose before the appellant. In a bay adjacent to the loading dock, there was an area, fenced on three sides, where two industrial waste bins were located. Next to the fenced area was a public parking area. The waste bins, when in use, were placed alongside the loading dock so that Woolworths staff could place waste in them. The bins belonged to the Stanthorpe Shire Council, and were emptied by Council employees on Mondays, Wednesdays and Fridays. The Council truck would reverse up the lane. Council workers would move the bins manually from the fenced area to the lane and place them in front of the loading dock. They would then be emptied mechanically into the Council truck. Routinely, the Council workers would leave the empty bins in the laneway in front of the loading dock without returning them to the fenced area. The bins constituted an obstacle to any delivery vehicle seeking access to the loading dock. The Council truck arrived at varying times between 4 am and 6 am. Whether the Council workers were derelict in their duty to the Council by leaving the empty bins in the laneway, or whether the Council was in breach of some obligation it owed to the respondent, were not questions that were McHugh Kirby Hayne investigated. The respondent's regular storeman, Mr Frank Thompson, acknowledged that his duties included returning the empty bins to the fenced area. Mr Thompson was away on holidays in August 1999, and his replacement, Mr Bennett, said in evidence that he was "not too sure" whether it was part of his job to move the bins. The evidence showed that the presence of industrial waste bins in the laneway, blocking access to the loading dock, was a long-standing source of friction between the appellant and employees of the respondent. There was evidence from other delivery drivers, who gave varying accounts of the problem. The bins were large, but were designed to be moved manually. That is how they were moved by the Council employees, the storeman and, not infrequently, delivery drivers themselves. The male witnesses in the case gave evidence of moving the bins without suffering any harm. But they presented a problem to the appellant. What delivery drivers achieved in terms of saving of time by moving the bins is not entirely clear. It was the storeman's job to move them. A driver could not complete the process of delivery without the presence of the storeman. Even if, as sometimes occurred, the storeman was not present when the driver arrived, and even if there was a delay of 10 to 15 minutes in responding to the buzzer, there was no possibility of the driver getting on with his or her rounds until the storeman arrived. Nevertheless, it is clear that, on occasion, if the storeman was not there when a driver arrived, the driver would move the empty bins back to the fenced area and thus clear the path to the loading dock. The drivers obviously thought this saved them some time. Over the months before August 1999, the appellant and her husband complained to the respondent's staff and management about the bins being left in the laneway. Mr Frank Thompson said that the appellant's husband complained to him seven times or more. On 22 May 1999, the appellant noted in her diary: "too heavy for manual moving ... too heavy for me to move by myself." The appellant's husband sometimes moved the bins for her. The appellant said that between March 1998 and August 1999 she moved the bins between 20 and 30 times. A week or two before the incident the subject of this litigation, the appellant was attempting to lift a crate of bread in a shed at her home. She had to reach up to the crate. As she was twisting to lower the crate, she felt a pain in her back. The pain subsided. McHugh Kirby Hayne On the day in question the appellant arrived at the shopping complex at about 5.15 am. No other person was present. The roller door between the loading dock and the storeroom was down. No storeman came out. There were empty waste bins in front of the loading dock. The appellant reversed her truck along the laneway towards the loading dock. She then left her truck and attempted to move one of the bins. She attempted to push the bin with her arms, but it would not move. She then brought one of her legs into play and as she pushed again she felt pain radiate down her back and leg. The appellant's husband arrived. She told him she had hurt her back. He then moved the bins. The two of them unloaded the bread onto the loading dock. An unidentified "store person" then came out of the storeroom, opened the door, and checked the quantity of bread. No complaint was made by the appellant or her husband to the "store person" or anyone else. After unloading they drove off to continue their deliveries. The decision of the primary judge There were issues at trial as to whether the appellant suffered the injuries she alleged, and as to the extent of those injuries. Those issues were resolved in favour of the appellant, and are not the subject of appeal. The appellant's case on liability was not that the respondent was vicariously liable for some casual act of negligence on the part of an employee of the respondent, but that there was a systemic failure to exercise reasonable care for the safety of the appellant. An expert witness, Mr McDougall, whose qualifications were engineering, and who reported on matters of industrial safety, expressed the opinion that the respondent should have conducted an appropriate audit of the extent of manual handling of the waste bins and either eliminated manual handling by providing truck access to the bin storage area through the car park, or introduced effective procedural controls to ensure that the respondent's employees relocated the bins after they were emptied and that delivery drivers were instructed not to move them. The trial judge found that, as between the respondent and the delivery drivers, it was the respondent's responsibility to move the bins. This does not seem to have been disputed. He found that employees of the respondent knew that the bins were an obstacle for delivery drivers, that they knew that drivers often moved the bins, and that they should have expected that the appellant would try to move them. He found that employees of the respondent were aware that moving the bins involved a risk of injury to someone of the appellant's size and strength. McHugh Kirby Hayne The primary judge found that the respondent "was aware of the risk of injury to the [appellant] pushing the bins and that some change ought to be made so that the [appellant] was not placed at risk of injury moving the bins." He held that the respondent "should have as a reasonable person implemented either of the measures identified by Mr McDougall in his evidence as either of those measures was not expensive or difficult or inconvenient to implement." As to the first of the measures recommended by Mr McDougall, there was nothing in the reasons for judgment dealing with the practicability of providing access to the bins through the car park except what is implicit in the statement just recorded. The matter was not explored in evidence in chief or cross-examination. The decision of the Court of Appeal In the Court of Appeal, McMurdo J, who would have upheld the decision of the primary judge on liability, summarised his conclusions as follows: "In the present case, the trial judge found that the risk of injury to the [appellant] was reasonably foreseeable. There is no basis for a challenge to that finding and I do not understand that it is challenged. In the context then of the [appellant] being a permitted entrant to premises in the [respondent's] occupation, the [respondent] owed her a duty to do what was reasonable to avoid the risk of injury from her attempting unassisted to move the bins. The content of this duty was then affected by a consideration of 'the magnitude of the risk and the degree of probability of its occurrence, along with the expense, difficulty and inconvenience of taking alleviating action and any other conflicting responsibilities which the defendant may have.' To these considerations can be added others such as the relationship between the parties, but ultimately the factual question is what a reasonable person, in the position of the respondent, would do by way of response to the risk. The trial judge held that reasonable care required the avoidance of the risk by one of two alternative courses, neither of which was said to be significantly expensive or problematical. In my view there was no error in that factual conclusion. The risk may have been obvious, but the probability of the occurrence of injury was relatively high. To the extent that the [respondent] did anything towards discharging its duty, it knew that this had not avoided the risk, and it knew or should have known that this was because the [appellant], like other drivers, was likely to run the risk of injury through the pressure of meeting the requirements of her McHugh Kirby Hayne work programme. It was, of course, a risk that came from the way in which the [respondent] organised its own business and premises. Because neither of the available steps was taken, the [appellant] remained exposed to the risk and the [respondent's] duty of care was breached." (references to authority omitted) McMurdo J found that there had been contributory negligence. Plainly, the appellant was or ought to have been aware of the risk of injury. McMurdo J did not mention expressly, but no doubt had in mind, not merely the diary note of May 1999 and the appellant's expressions of concern on previous occasions, but also the fact that she knew (and the respondent did not know and could not have known) of her recent back injury. He thought it appropriate that the judgment should be reduced by one-third, to $105,327.92. McMurdo J remarked, in connection with contributory negligence, that the circumstances "at least to some extent" explained why the appellant attempted to move the bins on the day in question. The reservations expressed in that qualification are understandable. Clearly, the appellant believed she was saving some time by moving the bins herself, and the fact that she and other drivers had often moved the bins on other occasions indicates that there must have been something to be gained by doing that. But the gain can hardly have been great, bearing in mind that the appellant was going to have to wait for a storeman before she could depart. The evidence of the appellant and her husband was that, on the day of the injury, they unloaded their bread onto the loading dock before the storeman arrived. Whatever time was involved in moving the bins and unloading, therefore, was saved by not waiting for the storeman to arrive and move the bins himself. That time was never quantified. The majority in the Court of Appeal stressed that the risk to the appellant involved in moving bins was not only foreseeable by the respondent but was foreseen by the appellant. This was not a case of alleged failure to warn. Nevertheless, de Jersey CJ said, the obviousness of the risk was factually significant in deciding what, if anything, reasonableness required of the respondent by way of response to that risk. He treated the question as one of "delineation of the scope of the duty of care owed by the [respondent]" to the appellant, and said: "In my view the duty of care owed by the [respondent] to the [appellant] did not embrace the [respondent's] taking steps to protect her from this particular risk. What occurred is explained by the circumstance that the [appellant], an independent contractor vis a vis the [respondent], chose unnecessarily to take that risk, the existence of which was clear to McHugh Kirby Hayne her. It is not explained by any tortious breach on the part of the [respondent]. The learned Judge's factual conclusion that the duty of care owed by the [respondent] extended to protection against this risk was not ... reasonably open." The other member of the majority, Williams JA, said that, as static objects, the bins blocked access to the loading dock, but they did not constitute a risk. No one could trip over them or inadvertently walk into them. "The only risk to the [appellant] came after she made a conscious decision to move, or attempt to move, the bins." He also said: "It is clear that as the occupier of the property, and as the entity for whose benefit the bins were on site, the [respondent] had the ultimate responsibility for moving the bins from where they were left by the local authority employees into the latticed area. My concern has been as to whether the [respondent] had a proper system in place to see that that was done. Given the irregular times at which the bins were emptied a reasonable occupier in the position of the [respondent] could really do no more than it had done in that regard. If able bodied delivery drivers did not move the bins for their own convenience without calling for assistance from employees of the [respondent], the bins were moved by employees of the [respondent] as soon as practicable after becoming aware of the fact they needed to be moved. The [appellant's] evidence was that if Frank Thompson saw her attempting to move a bin, he would always move it himself. Any delivery driver, male or female, requiring assistance had only to press the buzzer to call for assistance. A delay of 10 to 15 minutes on occasions was not unreasonable in that regard. The [appellant] in evidence referred to a concern that her place in the delivery queue would be lost if that was done. That is demonstrably not the case. It would be impossible on the evidence for any other delivery driver to get past her vehicle if it was at the head of the queue and its progress halted by the bins." Williams JA concluded that the evidence did not establish that there was any breach by the respondent of a relevant duty owed to the appellant. McHugh Kirby Hayne Duty of care It was not in question that the respondent owed a duty of care to the appellant, although there was a disagreement about the appropriate formulation of that duty. The status of the respondent as occupier of the land on which the appellant was injured was one aspect of the relationship that gave rise to a duty of care. It gave the respondent a measure of control that is regarded by the law as important in identifying the existence and nature of a duty of care3. There was, however, more to the relationship than that, and, as was agreed on both sides, the problem was not one that concerned only the physical condition of the respondent's premises. There was a time when the common law sought to define with precision the duty of care owed by an occupier of land, and treated the content of the duty as variable according to categories fixed by reference to the status of entrants4. The common law has since rejected the approach of seeking to construct a series of special duties by reference to different categories of entrant5. The problems involved in the former approach included the rigidity of the classification of entrants, and the artificiality of distinguishing between the static condition of premises and activities conducted on the premises. That is not to say, however, that the law now disregards any aspect of the relationship between the parties other than that of occupier and entrant. On the contrary, other aspects of the relationship may be important, as considerations relevant to a judgment about what reasonableness requires of a defendant, a judgment usually made in the context of deciding breach of duty (negligence). Even in the days when the content of an occupier's duty of care was defined by reference to fixed categories, within those categories the requirements of reasonableness were affected by a variety of considerations. Mason J, in Papatonakis v Australian Telecommunications Commission6, said: 3 Commissioner for Railways v McDermott [1967] 1 AC 169 at 186; Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 at 263 [18], 270 4 See, for example, Lipman v Clendinnen (1932) 46 CLR 550 at 554-556 per 5 Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479. (1985) 156 CLR 7 at 20. McHugh Kirby Hayne "The content of the occupier's duty to exercise reasonable care for the safety of an invitee must, of course, vary with the circumstances including the degree of knowledge or skill which may reasonably be expected of the invitee and the purpose for which the invitee enters upon the premises." The purpose for which, and the circumstances in which, the appellant was on the respondent's land, constituted a significant aspect of the relationship between them. The appellant, in the pursuit of her own business, was delivering goods to the respondent for the purpose of sale in the course of the respondent's business. To do that, she was required to conform to a delivery system established by the respondent. She was directed by the respondent when, where, and by what method she was to deliver. She was required to arrive between 5 am and 5.30 am, and to drive her truck along the laneway leading up to the respondent's loading dock. She was required to unload at a designated place, where the goods were to be counted and accepted by the respondent's storeman. Since the respondent established the system to which the appellant was required to conform, the respondent's duty covered not only the static condition of the premises but also the system of delivery. Some aspects of what went on were within the independent discretion of the appellant. She was not the respondent's employee. Within a fairly narrow time frame, she could choose when she made her deliveries. She could choose what kind of delivery vehicle suited her purpose. Decisions about the management of the vehicle, and the method of unloading, were largely left to her. Even so, the respondent established and maintained a system, and its obligation to exercise reasonable care for the safety of people who came onto its premises extended to exercising reasonable care that its system did not expose people who made deliveries to unreasonable risk of physical injury. A number of aspects of the facilities and procedures for the delivery of goods into the respondent's store might have involved issues of health and safety. Many, perhaps most, of the people who made the actual deliveries were outside the respondent's organization, and were not subject to the direct control it exerted over its employees. Even so, they were regular visitors to the premises, for a mutual commercial purpose, and it was reasonable to require the respondent to have them in contemplation as people who might be put at risk by the respondent's choice of facilities and procedures for delivery. The essential issue in the case concerns, not the existence or general nature of the duty owed by the respondent to the appellant, but whether there was a breach of duty. McHugh Kirby Hayne Breach of duty The appellant does not complain of a failure to warn her of a risk of which she was unaware. On the contrary, her evidence was that she knew of the risk of injury to herself involved in moving the industrial waste bins that sometimes blocked access to the loading dock, and had complained to the respondent about being exposed to that risk. We are not concerned with a question of the kind that arises where a plaintiff asserts that reasonableness required that a defendant warn of a hazard, and the defendant responds by saying that the hazard was so obvious that no warning was required7. Even so, the respondent relies upon the appellant's knowledge of the risk involved in attempting to move the bins herself. Indeed, the respondent points out that in one respect the appellant's knowledge was better than that of the respondent, in that the appellant knew, and the respondent did not know, that the appellant had suffered a recent back injury. As is common, questions of degree of risk are involved. Evidently, the bins were designed to be moved manually, and they were moved routinely by Council workers, the respondent's storemen, and other (male) delivery drivers without injury. Yet the appellant and her husband had told the respondent's employees that she could not move them safely, and Mr Frank Thompson agreed that she should not be moving them. What was involved was not a risk to everybody, but it was a risk to the appellant, and that was a risk of which the respondent was aware. The principal argument for the respondent is that the risk to the appellant arose, not from the respondent's delivery system, and the facilities and procedures associated with that system, but from the appellant's independent and unnecessary conduct in attempting to move the bins herself rather than waiting for a storeman to move the bins for her. This view of the facts is expressed in the passage from the reasons of Williams JA quoted above. Associated with this argument is the proposition that, in truth, the appellant achieved little or nothing by moving the bins. She had to wait for a storeman in any event. She could not leave before a storeman had checked off her delivery. There was no risk of her losing her place in a queue. On this approach, her action was one of pointless impatience. The respondent's system, it is said, did not oblige the appellant to move the bins, and she achieved little by doing so. cf Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460. McHugh Kirby Hayne To say that the system did not oblige the appellant to move the bins involves some over-simplification. The evidence showed that it was not unusual for delivery drivers, including the appellant, to move the bins themselves. It appears that they believed they were achieving some worthwhile saving of time, presumably because it enabled them to reach the loading dock more quickly, and commence unloading without having to wait for the arrival of a storeman. On a busy delivery run, at an early hour, it was clearly open to the delivery drivers to regard even a modest saving of time as worthwhile. It was open to the primary judge to regard that attitude as reasonable in the circumstances. There was evidence of delays of up to 10 or 15 minutes on the part of storemen when a delivery driver pressed a buzzer to call for a storeman's attendance for the purpose of accepting the delivery. The primary judge found that there was inconsistency between storemen in their responsiveness to the buzzer, and also in their understanding and acceptance of a responsibility to move the bins. He found that there was a reasonable concern on the part of the appellant that she would be delayed for a significant time if she did not move the bins herself. He also found that employees of the respondent, for their own benefit, were prepared to let delivery drivers move the bins rather than do the job themselves. In making those findings, the primary judge had the advantage of seeing and assessing the delivery drivers, including the appellant, and the employees of the respondent. The respondent's system for receiving deliveries from its suppliers, at least up until the time of the appellant's injury, left unresolved the problem created by the Council's method of dealing with the waste bins, that is to say, moving them into the laneway, emptying them, and leaving them obstructing access to the loading dock. That moving the bins could injure a driver of the appellant's stature was foreseeable, and foreseen; as was the risk that drivers of all sizes might attempt to move the bins in order to reduce delay. The respondent's employees would move the bins if asked to do so, but there was no procedure that meant they would always move them promptly, or that established that they, and not the delivery drivers, were to clear the access to the loading dock. When a person is required to take reasonable care to avoid a risk of harm to another, the weight to be given to an expectation that the other will exercise reasonable care for his or her own safety is a matter of factual judgment. It may depend upon the circumstances of the case. To take a commonplace example, in ordinary circumstances a motorist in a city street, approaching a pedestrian crossing, will reasonably assume that the pedestrians assembled on the footpath will observe the lights which control the crossing. Most people drive as though it may be expected that other road users will be reasonably careful. At the same McHugh Kirby Hayne time, it is often judged reasonable to expect a motorist to allow for the possibility that some other road users will be inattentive or even negligent. The obviousness of a risk, and the remoteness of the likelihood that other people will fail to observe and avoid it, are often factors relevant to a judgment about what reasonableness requires as a response. In the case of some risks, reasonableness may require no response. There are, for instance, no risk-free dwelling houses. The community's standards of reasonable behaviour do not require householders to eliminate all risks from their premises, or to place a notice at the front door warning entrants of all the dangers that await them if they fail to take care for their own safety. This is not a case about warnings. Even so, it may be noted that a conclusion, in a given case, that a warning is either necessary or sufficient, itself involves an assumption that those to whom the warning is addressed will take notice of it and will exercise care. The whole idea of warnings is that those who receive them will act carefully. There would be no purpose in issuing warnings unless it were reasonable to expect that people will modify their behaviour in response to warnings. The factual judgment involved in a decision about what is reasonably to be expected of a person who owes a duty of care to another involves an interplay of considerations. The weight to be given to any one of them is likely to vary according to circumstances. If the obviousness of a risk, and the reasonableness of an expectation that other people will take care for their own safety, were conclusive against liability in every case, there would be little room for a doctrine of contributory negligence. On the other hand, if those considerations were irrelevant, community standards of reasonable behaviour would require radical alteration. There was no sufficient reason for the Court of Appeal to set aside the primary judge's finding of negligence. The question was whether the respondent had a proper delivery system in place. Such a system should have included arrangements for moving the waste bins left in the laneway by the Council workers in order to clear access to the loading dock. The appellant, and the other delivery drivers, had no responsibility to design, and no power to implement, the delivery system operating on the respondent's premises. That power and responsibility belonged to the respondent alone. The respondent, in truth, had no system for that particular purpose. In practice, the respondent's employees either moved the bins themselves or left it to the delivery drivers to move the bins for them, according to the convenience of the respondent's employees and any other demands upon their time and attention. In the circumstances that prevailed, the respondent knew that, frequently, delivery drivers would move the bins. The respondent knew that not all drivers were capable of doing that without risk of McHugh Kirby Hayne injury. The reasoning of McMurdo J set out above is persuasive. The primary judge's finding of negligence should have been upheld. Contributory negligence McMurdo J was also correct to conclude that a case of contributory negligence had been established and that the primary judge had erred in failing so to find. The appellant was aware of the risk involved in moving the bins herself. She had recorded in her diary that they were too heavy for her. She and her husband had complained about the matter. The factors that weighed with the majority in the Court of Appeal, while not sufficient to displace the finding of negligence, were significant for the issue of contributory negligence. In this regard it is important to remember that, in her relationship with the respondent, the appellant was not an employee but an independent contractor. Different considerations arise in the case of contributory negligence on the part of employees8. Although some saving in time was achieved by the delivery drivers when they moved the bins themselves, it cannot have been great. Furthermore, in the case of the appellant, not only did she have to wait for the storeman before she completed her delivery, she was also accustomed to waiting for her husband to assist her with unloading and, if necessary, with moving the bins. On the occasion in question, the appellant attempted to move the bins without waiting either for the storeman or for her husband. Furthermore, the appellant knew, and the respondent did not know, that she had injured her back only a few days previously. The amount allowed by McMurdo J by way of apportionment should not be disturbed. The orders he proposed should be given effect. Orders The appeal should be allowed with costs. Orders 2 and 3 of the Court of Appeal should be set aside. In place of those orders it should be ordered that there be judgment for the appellant against the respondent in the action for 8 McLean v Tedman (1984) 155 CLR 306 at 315; Bankstown Foundry Pty Ltd v Braistina (1986) 160 CLR 301 at 309; Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 877 [60], 884 [87]; 179 ALR 321 at 333, 344. McHugh Kirby Hayne $105,327.92. The respondent should pay the appellant's costs of the proceedings at first instance. There should be no order as to the costs of the appeal to the Court of Appeal.

HIGH COURT OF AUSTRALIA BETFAIR PTY LIMITED & ANOR PLAINTIFFS AND STATE OF WESTERN AUSTRALIA DEFENDANT Betfair Pty Limited v Western Australia [2008] HCA 11 27 March 2008 ORDER The questions reserved in the amended special case dated 7 June 2007 be answered as follows: Question One Is s 24(1aa) of the Betting Control Act 1954 (WA) invalid either: wholly; or to the extent that s 24(1aa) would apply to a person, including the second plaintiff, who makes or accepts offers to bet through the use of the first plaintiff's betting exchange, by telephone or internet communication between a place in Western Australia and the Tasmanian premises, by reason of s 92 of the Constitution? Answer Section 24(1aa) of the Betting Control Act 1954 (WA) is invalid to the extent that it would apply to a person including the second plaintiff, who makes or accepts offers to bet through the use of the first plaintiff's betting exchange by telephone or internet communication between a place in Western Australia and the Tasmanian premises of the first plaintiff. Question Two Is s 27D(1) of the Betting Control Act 1954 (WA) invalid either: wholly; or to the extent that s 27D(1) would apply to conduct of the first plaintiff in publishing or otherwise making available a WA race field: by way of telephone or internet communication between the Tasmanian premises and a place in another State; or for the purpose of making or receiving offers to bet through the use of the first plaintiff's betting exchange by telephone or internet communication between the Tasmanian premises and a place in another State, by reason of s 92 of the Constitution? Answer Section 27D(1) of the Betting Control Act 1954 (WA) is invalid to the extent that it would apply to conduct of the first plaintiff in publishing or otherwise making available a WA race field: by way of telephone or internet communication between the Tasmanian premises of the first plaintiff and a place in another State; or for the purpose of making or receiving offers to bet through the use of the first plaintiff's betting exchange by telephone or internet communication between the Tasmanian premises of the first plaintiff and a place in another State. Question Three Is s 27D(1) of the Betting Control Act 1954 (WA) invalid or inoperative either: wholly; or to the extent that s 27D(1) would apply to conduct of the first plaintiff in publishing or otherwise making available a WA race field in: Tasmania; (ii) Western Australia; or (iii) elsewhere, by reason of s 118 of the Constitution or otherwise under the Constitution? Answer Unnecessary to answer. The costs of the plaintiffs of the amended special case be borne by the defendant. Representation S J Gageler SC with K C Morgan for the plaintiffs (instructed by Gilbert & Tobin) R J Meadows QC, Solicitor-General for the State of Western Australia with R M Mitchell and K H Glancy for the defendant (instructed by State Solicitor for Western Australia) D M J Bennett QC, Solicitor-General of the Commonwealth with G A Hill intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales with J K Kirk intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor for New South Wales) C J Kourakis QC, Solicitor-General for the State of South Australia with G F Cox and S A McDonald intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor for South Australia) P M Tate SC, Solicitor-General for the State of Victoria with S G E McLeish and S P Donaghue intervening on behalf of the Attorney-General for the State of Victoria (instructed by Victorian Government Solicitor) W Sofronoff QC, Solicitor-General of the State of Queensland with A M Pomerenke intervening on behalf of the Attorney-General of the State of Queensland (instructed by Crown Solicitor for Queensland) N J Young QC with S D Gates intervening on behalf of the Attorney-General of the State of Tasmania (instructed by Solicitor-General of the State of Tasmania) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Betfair Pty Limited v Western Australia Constitutional law (Cth) – Freedom of interstate trade, commerce and intercourse – Betting and Racing Legislation Amendment Act 2006 (WA) inserted ss 24(1aa) and 27D(1) into Betting Control Act 1954 (WA) ("WA Act") – Section 24(1aa) of WA Act provides that a person who bets through use of a betting exchange commits an offence – Section 27D(1) of WA Act provides that a person who, in Western Australia or elsewhere, publishes or otherwise makes available a Western Australian race field in the course of business commits an offence unless the person is authorised to do so by an approval, and complies with the conditions of that approval – First plaintiff was granted a licence under Div 5 of Pt 4A of the Gaming Control Act 1993 (Tas) to operate a betting exchange – Second plaintiff used computer connected to internet to place with first plaintiff bets on the outcome of races and other sporting events in Western Australia – Whether ss 24(1aa) and 27D(1) of WA Act are valid. Constitutional law (Cth) – Freedom of interstate trade, commerce and intercourse – Whether ss 24(1aa) and 27D(1) of WA Act impose impermissible disadvantage on first plaintiff that is not imposed on Western Australian wagering operators – Whether ss 24(1aa) and 27D(1) of the WA Act impermissibly preclude, on the supply side, increase in competition within the national market for betting services provided, on the demand side, by second plaintiff. Constitutional law (Cth) – Freedom of interstate trade, commerce and intercourse – Interpretation – Source of present doctrine respecting s 92 of Constitution – Role of s 92 to create national markets expressive of national unity – Object of s 92 in application to trade and commerce among States is to eliminate protection – Performance of role and fulfilment of object of s 92 changes with developments in legal and economic context in which s 92 operates – Utility of concept of "people of a State". Constitutional law (Cth) – Freedom of interstate trade, commerce and intercourse – Significance for present operation of s 92 of general understanding of concepts of "free trade" and "protection" against which provision was framed – "Free trade" understood in Australian colonies and British Empire as antithesis of "protection" – Significance of debates about free trade at time of federation. Constitutional law (Cth) – Freedom of interstate trade, commerce and intercourse – Relevance of United States decisions decided before 1900 to understanding provenance of s 92. Constitutional law (Cth) – Freedom of interstate trade, commerce and intercourse – Relevance of presence of non-protectionist objectives in legislation the practical effect of which is to discriminate against interstate trade in protectionist sense. Constitutional law (Cth) – Freedom of interstate trade, commerce and intercourse – Limitations of proposition that each State legislature has power to enact legislation for "well-being" of people of State – Application of "appropriate and adapted" criterion to laws discriminating against interstate trade in protectionist sense – Application of criterion of "reasonable necessity". Words and phrases – "appropriate and adapted", "free trade", "proportionality", "protection", "reasonable necessity". Constitution, s 92. Gaming Control Act 1993 (Tas), Div 5 Pt 4A. Betting Control Act 1954 (WA), ss 24(1aa), 27D(1). Betting and Racing Legislation Amendment Act 2006 (WA). GLEESON CJ, GUMMOW, KIRBY, HAYNE, CRENNAN AND KIEFEL JJ. Since 10 January 2006 the first plaintiff ("Betfair") has held a licence under Tasmanian law to operate a "betting exchange". A registered customer of Betfair (whom it describes as a "registered player") may place bets by a call to a telephone call centre at premises of Betfair in Hobart or by use of a computer connected by the internet to a computer server operated by Betfair at its Hobart premises. Customers may be located outside Tasmania and Betfair seeks to attract such customers located in States of the Commonwealth including Western Australia. Thus there is an interstate dimension to the operation by Betfair of its betting exchange. The second plaintiff, Mr Erceg, is a resident of Western Australia, and is a registered player. During the period 28 August 2006–24 January 2007 he used a computer connected to the internet to place with Betfair bets on horse and greyhound racing and other sporting events in Western Australia and other States. Over that period substantial amounts were bet with Betfair by registered players in Western Australia using telephones and the internet. The total sum, as to races in that State was more than $3.6 million, as to races elsewhere in Australia more than $9.6 million, and as to sporting and other events in Australia more than $2.5 million. However, by amendment to the law of Western Australia, which came into effect on 29 January 2007, it became an offence to bet through the use of a betting exchange. In addition, Betfair subsequently was refused the permission required under the amended law of Western Australia to make available important information, being "a WA race field" of horses or greyhounds, for facilitation of the making or receiving of offers by internet communication between the Hobart premises of Betfair and a place in another State. This litigation, in the original jurisdiction of the Court, arises from the changes made to the status quo ante in Western Australia. The issues come before the Full Court on an Amended Special Case. What might be called the out-of-State "supply" as well as the in-State "demand" side are represented by Betfair and Mr Erceg respectively. The importance in the determination of the ambit of any market of the supply and demand side, and of notions of substitution of various goods and services available in a market, is explained by McHugh J in Boral Besser Masonry Ltd v Australian Competition and Consumer Commission1. (2003) 215 CLR 374 at 454-456 [248]-[254]; [2003] HCA 5. Kirby Hayne Crennan Section 15 of the Interactive Gambling Act 2001 (Cth) creates an offence of providing an "interactive gambling service" to customers in Australia. An "excluded wagering service" is not an "interactive gambling service" (s 5(3), s 8A). No question of contravention of the federal statute arises. Moreover, s 69 expresses an intention not to exclude the operation of State laws capable of concurrent operation with the federal law. No argument based upon s 109 of the Constitution has been presented in these proceedings. Betting exchanges The introduction of the Tasmanian law under which Betfair is licensed and the changes to the law of Western Australia to which the plaintiffs object were preceded by the presentation on 10 July 2003 of a Report made to the Australasian Racing Ministers' Conference by a body styled the Betting Exchange Task Force ("the Report"). The Task Force comprised officers from the governments of the eight Australian States and internal Territories. It will be convenient to make further references to the Report later in these reasons. What is to be observed here is that the Report described the introduction of betting exchanges in the United Kingdom by a related company of Betfair. It continued: "The emergence of Internet-based betting exchange wagering platforms raises several highly challenging issues for the future viability of the Australian racing industry, consumer protection of punters and for government revenue flows from wagering. Australia's situation is unique among the World's first level racing countries. This stems jointly from its status as a Federation and the co-existence in all jurisdictions of bookmakers and totalizators (TAB). Eight individual racing jurisdictions, together with eight State and Territory Governments with a range of often disparate racing and the challenge of developing and wagering implementing a coordinated national response to the emergence of betting exchanges." legislation, heightens Under the heading "What is a betting exchange?" the Report continued further: Kirby Hayne "A betting exchange is a means by which parties stake money on opposing outcomes of a future event – such as a horse race or football game. Exchanges are structured to facilitate customers betting that a particular outcome will or will not occur. It is this 'against backing' (or backing to lose) aspect particularly in which betting exchanges differ from the traditional forms of wagering in Australia – with bookmakers or totalizators (TABs). The Internet is an ideal vehicle for betting exchange operations. It allows current exchange information to be displayed to a global audience in real time and facilitates automated wagering transactions against pre-established accounts and the efficient transfer of funds to and from accounts. While Internet betting exchanges on sport have existed since the mid-1990s, it has been in the sphere of racing betting that betting exchanges have enjoyed phenomenal growth recently. The adaptation of betting exchange principles to a multi-outcome event such as a horse race is achieved by breaking down each race into a series of binary events: each horse to win or lose. From the operator's perspective, a betting exchange is similar to a totalizator in terms of the absence of risk relating to the outcome of an event. In contrast to a bookmaker, the betting exchange operator is merely an intermediary – the risk is carried entirely by the customers themselves. Under the betting exchange models currently operating in Britain, operators derive income by charging a commission – at a relatively low rate – on (net) winnings." The plaintiffs' case The plaintiffs (with the support of Tasmania, one of the interveners) challenge the validity of the relevant provisions of the law of Western Australia, principally by reliance upon s 92 of the Constitution. They put their case for the application of s 92 upon two bases. The first is that the legislation of Western Australia impermissibly precludes, with respect to internet transactions having a geographical connection with that State, that increase in competition, on the supply side, within the national market for betting services which would be provided, on the demand side, by the presence within Western Australia at any Kirby Hayne Crennan one time of such persons as Mr Erceg. The second is that the legislation also applies to deny to the out-of-State operator in the position of Betfair access for the purposes of its Australia-wide operations to information respecting race fields which is generated by racing operators in Western Australia, whilst in-State wagering operators do not suffer that disadvantage. As will appear in these reasons, the case formulated by the plaintiffs in these terms should be accepted. Continuity, change and s 92 All parties accept as the source of present doctrine respecting s 92 what was said 20 years ago in Cole v Whitfield2 and further developed and applied in the authorities decided shortly thereafter, namely Bath v Alston Holdings Pty Ltd3, Castlemaine Tooheys Ltd v South Australia4 and Barley Marketing Board (NSW) v Norman5. Nevertheless, it would be an error to read what was decided in Cole v Whitfield6 as a complete break with all that had been said in this Court respecting the place of s 92 in the scheme of the Constitution. For example, in his reasons in Samuels v Readers' Digest Association Pty Ltd7 Barwick CJ rejected the proposition that the economic consequences of the operation of a law could not come within the purview of s 92. Barwick CJ also said in that case8: "No doubt the legislature of a State desiring to protect its traders from competition from traders in another State might well think that it would be of advantage to its traders to ban the kind of discount which its traders either did not wish to give or which its traders could not afford to (1988) 165 CLR 360. (1988) 165 CLR 411. (1990) 169 CLR 436. (1990) 171 CLR 182. (1988) 165 CLR 360. (1969) 120 CLR 1 at 17-18. (1969) 120 CLR 1 at 19. Kirby Hayne give. But that protection is, to my mind, demonstrably one of the kinds of interference with freedom of trade and commerce which cannot be sustained. As Fullagar J observed in McCarter v Brodie9: 'The protection of the industries of one State against those of another State was, of course, one of the primary things which s 92 was designed to prevent.' Or it may be that a State, according to the current philosophy of its government, may disapprove some trading practice and accordingly without any idea of protecting the trader ban it. But the economic consequence of a law cannot be disregarded and such a law is in no different case to a law designed to limit competition." One corrective administered by Cole v Whitfield was to the width of such phrases in the above passage as "one of the kinds ..." and "one of the primary things ...". Moreover, there have been significant developments in the last 20 years in the Australian legal and economic milieu in which s 92 operates. The first of these concerns an interpretation given to Ch IV of the Constitution by this Court in 1997. In Ha v New South Wales10 the Court recognised both the character of State "licence fees" as duties of excise to which s 90 of the Constitution applied and, at a more general level, the place occupied by both s 90 and s 92 in Ch IV of the Constitution. The creation and fostering of national markets would further the plan of the Constitution for the creation of a new federal nation and would be expressive of national unity. In that vein, Ha decided that the exclusivity of federal power to impose duties of excise is not limited to the more modest purpose of protection of the integrity of the tariff policy of the Commonwealth11. However, while s 90 is concerned with the imposition of duties of excise on goods, this case goes beyond that field and concerns the application of s 92 to services provided in commerce. (1950) 80 CLR 432 at 499. 10 (1997) 189 CLR 465. 11 (1997) 189 CLR 465 at 495-496. Kirby Hayne Crennan Another development since Cole v Whitfield is indicated in what has been said above respecting the circumstances of the present litigation. This is the appearance of what Judge Posner has called "the new economy"12 in which internet-dependent businesses, like that of Betfair, operate readily and deal with customers without regard to geographic boundaries. The point is illustrated by the activities of Betfair with respect to registered players in Western Australia before the changes to the law of that State. Cole v Whitfield established that, at least in its application to trade and commerce among the States, the object of s 92 is the elimination of protection. The term "protection" is concerned with the preclusion of competition, an activity which occurs in a market for goods or services. To focus upon the geographic dimension given by State boundaries, when considering competition in a market in internet commerce, presents practical and conceptual difficulties. Yet, Western Australia and supporting State interveners emphasised that s 92 permanently mandates that each State retain its own "economic centre". That proposition, as will appear from what is said later in these reasons, is overbroad. The third development the emergence since 1995, and by inter-government agreement under the auspices of the Council of Australian Governments, of a National Competition Policy. Elements of that policy include as a "guiding principle" that legislation should not restrict competition, unless it can be demonstrated that the benefits of the restrictions to the community as a whole outweigh the costs and that the objectives of the legislation "can only be achieved by restricting competition"13. Further, provision of financial assistance by the Commonwealth to the States is made conditional upon progress in the implementation of the National Competition Policy14. Counsel for the plaintiffs emphasised that the greater the degree of implementation of the National Competition Policy, the less the occasion for recourse to s 92. 12 Posner, "Antitrust in the New Economy", (2001) 68 Antitrust Law Journal 925. 13 Competition Principles Agreement, 11 April 1995, cl 5(1). 14 Agreement to Implement the National Competition Policy and Related Reforms, 11 April 1995. Kirby Hayne Developments such as these illustrate the force of the following statement in Cole v Whitfield15: "Inevitably the adoption of a new principle of law, though facilitating the resolution of old problems, brings a new array of questions in its wake. The five traditional examples of protection of domestic industry which we gave earlier are by no means exclusive or comprehensive. The means by which domestic industry or trade can be advantaged or protected are legion. The consequence is that there will always be scope for difficult questions of fact in determining whether particular legislative or executive measures constitute discriminatory interference with interstate trade." The references in this passage to "domestic industry" highlight the practical and conceptual perplexity that arises in accommodating internet commerce to the notion of protectionism in intrastate trade and commerce. Further, subsequent references in Castlemaine Tooheys16 to "the people of" the State and to "its" well-being, rather than to those persons who from time to time are placed on the supply side or the demand side of commerce and who are present in a given State at any particular time, have their own difficulties. They appear to discount the significance of movement of persons across Australia, and of instantaneous commercial communication, and to look back to a time of physically distinct communities located within colonial borders and separated by the tyranny of distance. Here, as elsewhere in debate respecting the operation of the Constitution17, there is continued force in the sentiment expressed by O'Connor J18 in the early years of the Commonwealth: 15 (1988) 165 CLR 360 at 408-409. 16 (1990) 169 CLR 436 at 472-473. 17 See, for example, Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 565-566; Sue v Hill (1999) 199 CLR 462 at 487-488 [50]-[51]; [1999] HCA 30. 18 Jumbunna Coal Mine, No Liability v Victorian Coal Miners' Association (1908) 6 CLR 309 at 367-368. See also, respecting s 92 itself, the remarks of Mason J in North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559 at 615. Kirby Hayne Crennan "[I]t must always be remembered that we are interpreting a Constitution broad and general in its terms, intended to apply to the varying conditions which the development of our community must involve." Differences in judicial opinion respecting the construction and application of s 92 to diverse political and economic circumstances have stemmed from the "broad and general" terms in which the section is expressed. One significant outcome of Cole v Whitfield19 was to return consideration of s 92 to the matters of political economy with a general understanding of which the provision was framed at the end of the 19th century. An appreciation of the somewhat fluid content of those matters at both the Imperial and colonial level assists an appreciation of the present operation of s 92 in the "new economy" in which Betfair operates in Australia. Yet, as indicated above, the distance from today of the times and circumstances of the colonial period requires that the admonition of O'Connor J be kept constantly in mind. The provenance of s 92 The familiar but still debatable terms of s 92 state: "On the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free. But notwithstanding anything in this Constitution, goods imported before the imposition of uniform duties of customs into any State, or into any Colony which, whilst the goods remain therein, becomes a State, shall, on thence passing into another State within two years after the imposition of such duties, be liable to any duty chargeable on the importation of such goods into the Commonwealth, less any duty paid in respect of the goods on their importation." The operation of the second sentence of this provision is long spent and the case law has concerned the first sentence. It is trite to observe that, with s 90, s 92 appears in Ch IV (ss 81-105A) of the Constitution and that this is headed "FINANCE AND TRADE". The 19 (1988) 165 CLR 360. Kirby Hayne relationship between s 90 and s 92 was explained as follows by Brennan CJ, McHugh, Gummow and Kirby JJ in Ha v New South Wales20: "It is clear that an objective of the movement to Federation was 'inter-colonial free trade on the basis of a uniform tariff' as this Court pointed out in Cole v Whitfield21. That objective could not have been achieved if the States had retained the power to place a tax on goods within their borders. If goods that attracted a State tax were imported into the State from outside the Commonwealth, Commonwealth tariff policy would have been compromised by the imposition of a State tax. The second paragraph of s 9222 and the third paragraph of s 9523 (by limiting the period of its operation) show that such a tax was alien to the scheme of Ch IV. If a State tax were imposed on goods brought into the State having been produced or manufactured elsewhere in the Commonwealth, the tax would affect the freedom of trade in those goods24 and might be a duty of customs on the entry of the goods into the taxing State25. If a State tax were imposed on goods of local production or manufacture within the State, it would be a duty of excise on any view of the term." However, as remarked earlier in these reasons, the trade and commerce of which s 92 speaks is not limited to dealings in goods and this indicates that Ch IV implemented a broader scheme of political economy. 20 (1997) 189 CLR 465 at 494-495. 21 (1988) 165 CLR 360 at 386, citing the 1891 Report of the South Australian Royal Commission on Inter-Colonial Free Trade at vi. 22 [Set out above]. 23 This states: "If at any time during the five years the duty on any goods under this section is higher than the duty imposed by the Commonwealth on the importation of the like goods, then such higher duty shall be collected on the goods when imported into Western Australia from beyond the limits of the Commonwealth." 24 Bath v Alston Holdings Pty Ltd (1988) 165 CLR 411. 25 Section 95 par 1 and see The Commonwealth and Commonwealth Oil Refineries Ltd v South Australia (1926) 38 CLR 408 at 430 per Isaacs J, 435 per Higgins J. Kirby Hayne Crennan The inclusion of Ch IV in the Constitution illustrates the point made by Palgrave in his Dictionary of Political Economy which was published in London "All known precedents lead us to associate the idea of commercial federation with that of political federation. In the existing federal systems with which we are familiar, such as those of the United States, Germany, Switzerland, Austria-Hungary, and Canada, freedom of internal trade has been the result, even where it has not been the fundamental condition, of political unity. In the system which has been proposed for the Australasian colonies one of the chief objects aimed at is the same freedom of internal trade. Free commercial intercourse, indeed, seems one of the most distinctive marks of national unity. It appeals directly to the masses, and gives at once a sense of mutual interest and mutual benefit." (emphasis added) But what was conveyed by such expressions as "commercial federation", "free commercial intercourse" and "freedom of internal trade"? In Cole v Whitfield27, after remarking: "the principal goals of the movement towards the federation of the Australian colonies included the elimination of intercolonial border duties and discriminatory burdens and preferences in intercolonial trade and the achievement of intercolonial free trade", the Court continued28: "The expression 'free trade' commonly signified in the nineteenth century, as it does today, an absence of protectionism, ie, the protection of domestic industries against foreign competition. Such protection may be achieved by a variety of different measures – eg, tariffs that increase the price of foreign goods, non-tariff barriers such as quotas on imports, 26 Sir Robert Inglis Palgrave (ed), Dictionary of Political Economy, vol 2 (1896) at 45-46. Palgrave (1827-1919), English banker and economist, was editor of The Economist 1877-1883. 27 (1988) 165 CLR 360 at 392. 28 (1988) 165 CLR 360 at 392-393. Kirby Hayne differential railway rates, subsidies on goods produced and discriminatory burdens on dealings with imports – which, alone or in combination, make importing and dealings with imports difficult or impossible. Sections 92, 99 and 102 were apt to eliminate these measures and thereby to ensure that the Australian States should be a free trade area in which legislative or executive discrimination against interstate trade and commerce should be prohibited. Section 92 precluded the imposition of protectionist burdens: not only interstate border customs duties but also burdens, whether fiscal or non-fiscal, which discriminated against interstate trade and commerce. That was the historical object of s 92 and the emphasis of the text of s 92 ensured that it was appropriate to attain it." (emphasis added) the juxtaposes terms "free The emphasised passage trade" and "protectionism" as marking out the field of controversy in the Australian colonies respecting fiscal policy which preceded the adoption of the Constitution. But, for example, to speak of the colony of New South Wales as "free trade" and that of Victoria as "protectionist" is apt to mislead. Not least is it apt to mislead because the use of the labels may mask the complexities of the debates about issues of protection and free trade that occurred during the second half of the 19th century and the early years of the 20th century. Debates about these issues took on political and social dimensions. But by the early years of the 20th century, "protection" had become so settled a national policy that Professor Hancock was later to write29 that "[p]rotection ... has been more than a policy; it has been a faith and a dogma ... interwoven with almost every strand of Australia's democratic nationalism". At the time of the framing of the Constitution, the command economies of 20th century totalitarian states lay in the future. It was not the colonies but individuals and trading and financial corporations that engaged in intercolonial trade and commerce and whose businesses were affected by the adoption by government of particular commercial policies. To perceive this does not mandate any return to an "individual rights" interpretation of s 92 which was discredited by Cole v Whitfield. Further, as counsel for the present plaintiffs correctly emphasised, that earlier interpretation had emphasised the position of those on 29 See Hirst, "Protection", in Davison et al (eds), The Oxford Companion to Australian History, rev ed (2001) 536 at 537. Kirby Hayne Crennan the out-of-State "supply" side to the exclusion of the in-State "demand" side of trade and commerce. Notwithstanding the complexities of the debates about issues of protection and free trade, generally "protection" referred to the protection of local production of goods by tariff barriers and "free trade" was seen as its antithesis. An understanding of one way in which the terms "free trade" and "protectionism" were used at the time of federation is assisted by entries in Palgrave's Dictionary of Political Economy, a work to which reference has been made above. After describing the earlier use of the term "free trade", "somewhat vaguely" to denote an "absence of restraint in general", Palgrave wrote30: "Adam Smith's authority, and the direction given by him to economic thought, have caused its limitation to that system of commercial policy which draws no distinction between domestic and foreign commodities, and, therefore, neither imposes additional burdens on the latter nor grants any special favours to the former. Free trade in this now well-established sense does not require the removal of all duties on commodities; it only insists that they shall be levied exclusively for revenue, not at all for PROTECTION (q.v.). 'Our object,' said Cobden, 'is not to take away the queen's officers from the custom-house, but to take those officers away who sit at the receipt of custom to take tithe and toll for the benefit of particular classes' (Speeches, pop. ed. p 41)." (emphasis added) However, it is important to note that the scheme of Ch IV of the Constitution insisted on more than is suggested by this statement; it did require removal of the customs houses at State borders. Of the term "protection" it was said by Palgrave that "[i]n common with all systems of economic policy, protection springs from a set of conditions, sentiments, and beliefs"31. With particular relevance to attitudes taken in Australia, he wrote that "[t]o the loyal citizen the promotion of native industry 30 Dictionary of Political Economy, vol 2 (1896) at 143. Of British politics by the 1860s, it is said that "a central orthodoxy" was "free trade – in its specific sense of an absence of protective tariffs": Matthew, "The Liberal Age (1851-1914)", in Morgan (ed), The Oxford History of Britain, rev ed (2001) 518 at 524. 31 Dictionary of Political Economy, vol 3 (1899) at 234. Kirby Hayne and economic interests seems a duty nearly as imperative as the defence of the national territory against invasion. Protection is thus one side or aspect of national sentiment, influenced indeed by a special bias." However, debate in the Australian colonies respecting fiscal policy took place in the broader surroundings provided by inclusion of the Australian colonies in the British Empire and the presence of ultimate power resting at Westminster and in the Colonial Office. The legislation of the mid-19th century which established responsible and representative government in the colonies of Canada and Australasia was enacted at the time of completion of the free trade reforms associated particularly with the second administration of Sir Robert Peel (1841-1846)32. By 1860, only 48 items remained on the British customs list and they were not needed to protect British industries33. When the south-eastern Australian colonies attained self-government, they gained control of at least some elements of their commercial policies34 (including control of revenues derived from customs duties and excise35, from the disposal of the wastelands of the Crown and from the mining of gold36). In the 1860s Victoria asserted its right to establish protectionist tariffs. In 1873 the Australian colonies asserted their right to discriminate in favour of each other, even to the disadvantage of other parts of the Empire, but, by force of the proviso to s 3 of the Australian Colonies Duties Act 1873 (Imp)37, the colonies were bound not to levy or remit duties contrary to, or at variance with, any treaty for the time being between the Crown and any foreign power. 32 Ward, Colonial Self-Government: The British Experience 1759-1856, rev ed 33 Heaton, Economic History of Europe, (1948) at 640. 34 Relevant constitutional arrangements differed between the colonies. See generally the discussion by Shann, "Economic and Political Development, 1860-1885", in Rose et al (eds), The Cambridge History of the British Empire, vol 7 pt 1 (1933) 35 Ha v New South Wales (1997) 189 CLR 465 at 493-494. 36 Jenks, A History of the Australasian Colonies, (1896) at 231-232. 37 36 Vict c 22. Kirby Hayne Crennan The course of Imperial affairs with respect to commercial policy was summed up by Professor Hancock in 1930 as follows38: "Until 1846 the British Empire had been a single economic unit in its commercial relations, with a Protectionist policy made in Great Britain. In 1846 Great Britain became a Free Trade country. But she still assumed that the Empire would remain a commercial unity, with a common Free Trade policy. The self-governing colonies thought otherwise. In 1859 Canada asserted her right to set up a Protectionist tariff, even against Great Britain[39]. In 1873 the Australian colonies asserted their right to discriminate in favour of each other, even to the disadvantage of other parts of the Empire. It was not long before the new order of things began to affect the foreign relations of the Empire. In the seventies the Australian colonies won recognition of their right to adhere separately to trade treaties made by Great Britain, or, if it pleased them, not to adhere at all. Later on they exercised a right of withdrawing from trade treaties which Great Britain had negotiated in the past. Finally they began, in association with British representatives, to negotiate their own treaties. The Commonwealth [of Australia] to-day is party to many treaties which deal with commerce, postal affairs, scientific and humanitarian concerns, and all sorts of technical matters. At last, in 1907, Canada negotiated a commercial treaty with France, without any intervention at all of British officials. That event marked the end of the process. Before the war the self-governing Dominions could bargain with foreign countries, in commercial matters, on terms of complete equality and independence[40]." The developing federal movement in the Australian colonies had been faced with the need to formulate commercial policy bearing both a foreign and a domestic aspect. As to the former, the federal legislative power conferred by s 51(i) and the exclusive power over uniform duties of customs and excise conferred by s 90 enabled Australia to take its place in international trade as a 38 Hancock, Australia, (1930) at 257-258. 39 Skelton, "Canada Under Responsible Government, 1854-1867", in Rose et al (eds), The Cambridge History of the British Empire, vol 6 (1930) 333 at 349-350. 40 See also Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 476-478. Kirby Hayne single trading unit but behind a protectionist wall which was to remain for many years. The domestic aspect of trade and fiscal policy was not dealt with so readily. Looking at the subject of domestic protectionism and the operation of s 92, it may be suggested that the emergence of global institutions, including the International Labour Organisation (1919), the General Agreement on Tariffs and Trade (1947) and the World Trade Organisation (1995), some of which appear to be premised on the economic value of "free trade", is a development which properly fuels "an implicit assumption that anti-protectionist rules in national legal systems share that same normative foundation"41. However, domestic political pressures in the Australian colonies and the Imperial context in which the colonies conducted their affairs meant that more was involved in the formulation of s 92. The relevance of the United States decisions Counsel for the plaintiffs properly emphasised that assistance in framing s 92 was derived from the contemporary law in the United States. That country after 1890 pursued a protectionist policy as regards foreign trade, in contrast to the position of the United Kingdom42, where the protection of domestic industry from foreign competition was seen as defiance of the laws of political economy. However, within the United States the "negative Commerce Clause" had been developed by the Supreme Court to support an exclusive federal legislative power and to foster a national economy rather than an economy comprising markets constrained by legislation based upon the geographical limits of the States. That development had been in response to an apparent, albeit at times inconvenient, truth. This is that legislators in one political subdivision, such as the States, may be susceptible to pressures which encourage decisions adverse to the commercial and other interests of those who are not their constituents and not their taxpayers. 41 Simpson, "Grounding the High Court's Modern Section 92 Jurisprudence: The Case for Improper Purpose as the Touchstone", (2005) 33 Federal Law Review 42 Ensor, England 1870-1914, (1936) at 276. Kirby Hayne Crennan Professor Tribe, writing on the Commerce Clause in the United States Constitution, has remarked43: "That recognition reflects not a cynical view of the failings of statesmanship at a sub-federal level, but only an understanding that the proper structural role of state lawmakers is to protect and promote the interests of their own constituents. That role is one that they will inevitably try to fulfill even at the expense of citizens of other states. this context, the rhetoric of judicial deference the democratically fashioned judgments of legislatures is often inapposite. The checks on which we rely to curb the abuse of legislative power – election and recall – are simply unavailable to those who have no effective voice or vote in the jurisdiction which harms them. This problem is most acute when a state enacts commercial laws that regulate extraterritorial trade, so that unrepresented outsiders are affected even if they do not cross the state's borders." The thought expressed here had been captured in the statement by Cardozo J in the United States Supreme Court in Baldwin v G A F Seelig, Inc44: "The Constitution was framed under the dominion of a political philosophy less parochial in range. It was framed upon the theory that the peoples of the several states must sink or swim together, and that in the long run prosperity and salvation are in union and not division." Earlier in those reasons, and in a passage upon which the present plaintiffs rely, Cardozo J said of the New York law which was successfully challenged in Baldwin45: "New York asserts her power to outlaw milk so introduced by prohibiting its sale thereafter if the price that has been paid for it to the farmers of 43 American Constitutional Law, 3rd ed, vol 1 (2000) at 1051-1052 (footnotes omitted). 44 294 US 511 at 523 (1935). 45 294 US 511 at 521 (1935). Kirby Hayne Vermont is less than would be owing in like circumstances to farmers in New York. The importer in that view may keep his milk or drink it, but sell it he may not. Such a power, if exerted, will set a barrier to traffic between one state and another as effective as if customs duties, equal to the price differential, had been laid upon the thing transported." Counsel for Western Australia emphasised in oral submissions that s 92 was not designed to create "a laissez-faire economy in Australia"; rather, it had a more limited operation, to prevent the use of State boundaries as trade borders or barriers for the protection of intrastate players in a market from competition from interstate players in that market. This may be accepted, but it does not deny the utility of the United States decisions. Nevertheless, in Barley Marketing Board (NSW) v Norman46 the Court remarked: "The United States decisions provide limited assistance. That is because some of them proceed according to the view that the object of the commerce clause was to bring into existence a free market economy or a free trade area in the sense that restrictions on competition are unconstitutional. That interpretation of the commerce clause gives it a more wide-ranging operation than Cole v Whitfield accords to s 92 with its guarantee of freedom from discriminatory burdens of a protectionist kind." To some degree, acceptance for s 92 of a laissez-faire interpretation of the kind identified in Norman would further a revival of an "individual rights" theory of s 92. Hence, perhaps, the reservation expressed in Norman. However, those United States decisions upon the Commerce Clause, discussion of which preceded the statement in Norman, were decided well after 1900 and did not reflect the line of United States authority as it stood in the last part of the 19th century when s 92 was formulated. In Castlemaine Tooheys47 (which preceded Norman) five Justices had said that assistance in applying s 92 could be derived from a particular group of 46 (1990) 171 CLR 182 at 203-204. 47 (1990) 169 CLR 436 at 468-470. Kirby Hayne Crennan United States authorities, including the 1935 decision in Baldwin v G A F Seelig, Inc48; reference has been made above to the reasons of Cardozo J in that case. The United States authorities concentrated not upon "broader notions of free trade", but upon such matters as "economic barriers" to interstate trade, the existence of a "national economic unit" and the protection of "the free market forces" in that union so as to protect "the domestic producer or trader against the out-of-State producer or trader". That consideration of the United States authorities in Castlemaine Tooheys requires adjustment to allow for both the demand and supply side, but, with that qualification, it rightly plays a significant part in the case presented by the plaintiffs. The pre-1900 United States decisions The pre-1900 Commerce Clause authorities provide assistance in construing s 92 of the kind approved in Castlemaine Tooheys49; they also indicate the provenance of s 92 in terms consistent with its text and present doctrine respecting its meaning and the case presented by the plaintiffs. Their effect was summed up as follows by Barton J in Fox v Robbins50: "The Constitution of the United States contains no such provision as our s 92. The framers of that instrument gave Congress the right to regulate trade and commerce with other countries and among the States. In terms, that right is not exclusive. The Supreme Court however has repeatedly held it to be exclusive of any State legislative power, 'so far ... that no State has power to make any law or regulation which will affect the free and unrestrained intercourse and trade between the States, as Congress has left it, or which will impose any discriminating burden or tax upon the citizens or products of other States, coming or brought within its jurisdiction:' Brown v Houston51. The Australian Constitution, for more abundant caution, has enacted in s 92 that: 'On the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be 49 (1990) 169 CLR 436 at 468-470. 50 (1909) 8 CLR 115 at 122-123. 51 114 US 622 at 630 (1885). Kirby Hayne absolutely free.' In this respect the Australian Constitution is stronger than the American." (emphasis added) It will be seen that the treatment of "free and unrestrained intercourse and trade", in the sense of laissez-faire, was considered in Brown v Houston in the light of the supremacy of federal law; hence the attachment of the words "as Congress has left it". The succeeding proposition, that referring to discrimination and thus relevant to s 92, was expressed in terms narrower than the first, and in the sense of a negative implication restrictive on State legislative power rather than with reference to any actual exercise by Congress of its power. Guy v Baltimore52 concerned the so-called "dormant" Commerce Clause. The Supreme Court held that an ordinance of the City of Baltimore, Maryland, conflicted with the power conferred on Congress by the Commerce Clause. The ordinance required payment for the use of public wharves at Baltimore by vessels laden with the products of other States, fees not exacted from vessels landing the products of Maryland itself. Harlan J said that these fees53: "although denominated wharfage dues, cannot be regarded, in the sense of our former decisions, as compensation merely for the use of the city's property, but as a mere expedient or device to accomplish, by indirection, what the State could not accomplish by a direct tax, viz., build up its domestic commerce by means of unequal and oppressive burdens upon the industry and business of other States". "Municipal corporations, owning wharves upon the public navigable waters of the United States, and quasi public corporations transporting the products of the country, cannot be permitted by discriminations of that character to impede commercial intercourse and traffic among the several States and with foreign nations." 52 100 US 434 at 443-444 (1879). 53 100 US 434 at 443 (1879). 54 100 US 434 at 443 (1879). Kirby Hayne Crennan Most significantly for an understanding of the provenance of s 92, Harlan J, after referring to earlier decisions of the Supreme Court, said55: "In view of these and other decisions of this court, it must be regarded as settled that no State can, consistently with the Federal Constitution, impose upon the products of other States, brought therein for sale or use, or upon citizens because engaged in the sale therein, or the transportation thereto, of the products of other States, more onerous public burdens or taxes than it imposes upon the like products of its own territory." In the present case counsel for the plaintiffs related that passage in Guy v Baltimore to the position of his clients by referring to the "more onerous public burden" being imposed by the law of Western Australia upon the business of Betfair than that imposed upon competing or "like" businesses of its own territory. Further, it was this passage in Guy v Baltimore56 which Sir Henry Parkes quoted on 10 February 1890 at the Australasian Federation Conference in Melbourne, adding57: "The case seems to set at rest, in the most emphatic manner, what is sometimes disputed – the question of existence of entire freedom throughout the territory of the United States. As the members of the Conference know, she has created a tariff of a very severe, and in some cases almost prohibitive character against the outside world; but as between New York and Massachusetts, and as between Connecticut and Pennsylvania, there is no custom-house and no tax-collector. Between any two of the States – indeed from one end of the States to the other – the country is as free as the air in which the swallow flies. We cannot too fully bear in mind this doctrine of the great republic, a doctrine supported in the most convincing manner by the case to which I have alluded." 55 100 US 434 at 439 (1879). 56 100 US 434 at 439 (1879). 57 Official Record of the Proceedings and Debates of the Australasian Federation Conference, (Melbourne), 10 February 1890 at 46. Kirby Hayne Professor La Nauze surmised that it was Inglis Clark who may have drawn the attention of Parkes to Guy v Baltimore58. At all events, it was in evident accord with these views that at the Sydney Convention on 4 March 1891 Sir "That the trade and intercourse between the federated colonies, whether by means of land carriage or coastal navigation, shall be absolutely free." It also should be noted that in 1890 Guy v Baltimore60 had been applied in Minnesota v Barber61. A law of Minnesota invalidly required the inspection in that State before slaughter of any animals from which meat was taken for sale in the State for human consumption. Again the judgment of the Supreme Court was delivered by Harlan J. He looked to the practical effect of the law62 and both to the demand and supply side, remarking63: "A burden imposed by a State upon interstate commerce is not to be sustained simply because the statute imposing it applies alike to the people of all the States, including the people of the State enacting such statute. ... The people of Minnesota have as much right to protection against the enactments of that State, interfering with the freedom of commerce among the States, as have the people of other States. Although this statute is not avowedly, or in terms, directed against the bringing into Minnesota of the products of other States, its necessary effect is to burden or obstruct commerce with other States, as involved in the transportation into that State, for purposes of sale there, of all fresh beef, veal, mutton, lamb or 58 La Nauze, "A Little Bit of Lawyers' Language: The History of 'Absolutely Free', 1890-1900", in Martin (ed), Essays in Australian Federation, (1969) 57 at 69. 59 Official Record of the Debates of the Australasian Federal Convention, (Sydney), 4 March 1891 at 23. 62 A point made by Barton J in his dissenting reasons in Duncan v State of Queensland (1916) 22 CLR 556 at 598. 63 136 US 313 at 326 (1890). Kirby Hayne Crennan pork, however free from disease may have been the animals from which it was taken." Commerce Clause decisions such as Minnesota v Barber are important for a further reason. They indicate that a law the practical effect of which is to discriminate against interstate trade in a protectionist sense is not saved by the presence of other objectives such as public health which are not protectionist in character. The promotion of litter control and of energy and resource conservation were propounded objects of the law which was held to fail in Castlemaine Tooheys64. That law sought to achieve those objects by exempting refillable bottles from the requirement for the payment of a mandatory deposit65. But this was no answer to the practical effect of the law which was held to be an impermissible discrimination of a protectionist kind against interstate trade. The Commonwealth, as intervener, submitted that it is sufficient for validity of a law if one of several objectives is non-protectionist. That submission is inconsistent both with Castlemaine Tooheys and with the United States decisions before federation which influenced the framing of s 92. If accepted, the Commonwealth submission would impermissibly weaken the force of the imperative demand of s 92. It would do so by allowing to stand legislation which imposes upon interstate trade a discriminatory burden of a protectionist kind, merely because of the presence of other objectives. With the above general considerations respecting s 92 in mind, we turn to consider first the methods of wagering which predated the arrival of the betting exchange in Tasmania, and then the legislation of Tasmania and that of Western Australia. Bookmakers, totalisator betting and the betting exchange One form of betting lawfully conducted in Australia has been pari-mutuel or totalisator or "TAB" betting. This is commonly called "starting price" betting. It involves the determination of dividends in respect of a particular event by reference to the size of the betting pool (less the commission charges of the 64 (1990) 169 CLR 436. 65 (1990) 169 CLR 436 at 464, 474-475. Kirby Hayne operator) and the number of successful bets66; one consequence of this system, as the Report noted, is the absence of risk to the totalisator relating to the outcome of the event. Another form of betting is "fixed odds" betting which is conducted by licensed bookmakers. The legislation considered in this case contained no helpful definition of what is involved in the business of a bookmaker. In Fingleton v Lowen67 Zelling J said of the original meaning of the term "bookmaker": "A bookmaker was one who made up a book on all the horses in a given race, adjusting the odds and the volume of money he took on any particular horse, so that if his calculations were correct, at the end of the race, no matter what horse won, the book would show a profit to the bookmaker." The evidence shows that, at the present day, when provided by bookmakers, "fixed odds" involves the punter always placing a "back" bet that an outcome (a win or place) will occur, whilst the bookmaker is always "laying" the bet by betting that the outcome will not occur; however, the bookmaker may seek to balance the "book" (and reduce risk) by "betting back", that is to say, by placing bets with another bookmaker in favour of the result which has been wagered not to occur. All Australian States provide for the licensing of corporate bookmakers, for licensed bookmakers to bet by telephone or over the internet with persons not on a racecourse, and for licensed bookmakers to bet on sporting events. All States also allow TAB betting to be accepted by telephone or over the internet and to be placed on sporting events. In 2005-2006 the total betting turnover for bookmakers in Australia was more than $4.5 billion, and, of the more than $2.8 billion derived from betting on thoroughbred races, 70.4 per cent was derived from telephone and internet betting. In the same period the total TAB betting turnover was more than $13.3 66 See the discussion by Hale J in Totalisator Agency Board v Wagner [1963] WAR 180 at 190-191. 67 (1979) 20 SASR 312 at 314. Kirby Hayne Crennan billion and, of the more than $8.7 billion derived from thoroughbred races, 20 per cent was derived from telephone and internet betting on off-course totalisators. In Western Australia, bookmakers are required to pay an annual licence fee calculated as a percentage of annual turnover, and a levy to those racing clubs on whose course the bookmaker conducts business, again calculated as a percentage of turnover. Racing clubs conducting on-course totalisators are also required to pay an annual licence fee calculated in the same way. There are currently 47 bookmakers licensed in Western Australia; all are licensed to accept bets on races conducted in that State and elsewhere. Some 18 are licensed to accept bets by telephone or over the internet. Of that group 17 are licensed to accept bets over the internet by a website operated by Best Bookies Pty Ltd which is accessible to any person with an internet connection. An essential difference between fixed odds betting conducted by Betfair and that conducted by bookmakers is that Betfair does not "hold a book" and does not carry any risk on the outcome of the event. Another is that whilst punters cannot back an entrant to "lose" when placing bets with a bookmaker (or on a TAB), they can do so with Betfair. Betfair uploads onto its computer server information about each racing and sporting event in Australia on which wagers may be placed; the information includes, with respect to racing, the race field. Betfair charges a commission of generally between two and five per cent of net winnings, which is provided by registered players. Betfair requires registered players to deposit sufficient funds to cover the bets they wish to make. Betfair uses its computer program to match opposing bets by other registered players which have not been previously matched. Payments are made from a "Hobart account" of Betfair to the nominated bank account in Australia of the registered player concerned. The arrival in Australia of the betting exchange In the Summary provided in the Report to the Racing Ministers to which reference has been made, the following appeared: The appeal to punters of betting exchanges on racing lies mainly in: The fact bets are struck at fixed odds – in contrast to totalizator (TAB) betting. Kirby Hayne Availability of better odds – relative to bookmakers and TABs. These attractive odds are available partly because punters are able to transact directly with each other (no intermediary required to bear the risk of the wager) and, as is currently the case with Betfair's London-based operations on Australian racing, for example, betting exchanges benefit from operating in regimes characterised by low (or nil) contributions to the racing industry and betting taxes. The facility for punters to bet against ('lay') runners. Punter-friendly commission structures. Punters' anonymity viz-a-viz each other (in contrast to betting with bookmakers). If betting exchanges are allowed to (continue to) operate on Australian racing under circumstances where they are able to operate profitably while charging customers an advertised commission rate ranging from 5% down to 2% (on net winnings per event), betting exchanges will likely prove a popular alternative to betting on Australian racing with TABs or licensed Australian bookmakers. This will likely be at significant expense to these industry and existing operators – and hence State/Territory revenue streams from wagering. racing The extent of betting exchanges' future popularity among Australian punters will depend to a degree upon whether one or more betting exchange operators are able to acquire an 'authorisation' from the Australian racing industry and/or Australian Governments to operate on Australian racing (or sport) and accept bets from Australian punters." Under the heading "Commercial and revenue repercussions" the Report read: "Some advocates of betting exchanges suggest that exchange operations on Australian racing will 'create a purely additive revenue stream for the (racing) industry', ie the turnover through betting exchanges will be entirely 'new money'. The Task Force is not convinced. Rather, it concludes that betting exchanges on Australian racing would pose a serious threat to current betting turnover levels of the three categories of Kirby Hayne Crennan licensed wagering operator in Australia – TABs, traditional bookmakers and corporate bookmakers. Hypothetically, in the extreme scenario of a national, fully 'authorised' betting exchange on Australian racing operating under a local regime similar to that presently applying in Britain, the Task Force forecasts that, over the medium term (five years), transfers of racing betting turnover from existing licensed Australian wagering operators could be as high as 20% in the case of TABs and traditional bookmakers, rising to 30% in the case of corporate bookmakers." The 2005 Tasmanian legislation represented the legislative response to these considerations by one State. The subsequent response in Western Australia was quite different. We turn first to the situation in Tasmania. The Tasmanian legislation On 10 January 2006, Betfair was granted a licence under Div 5 (ss 76ZDA-76ZDM) of Pt 4A of the Gaming Control Act 1993 (Tas) ("the Tasmanian Act") to operate a "betting exchange"68. From its premises in Hobart, Betfair commenced operation of a betting exchange by means of a telephone call centre on 16 June 2006, and by means of computers connected to the internet on 28 August 2006. For the purposes of the Tasmanian Act a "betting exchange" is defined69 as meaning: "a facility that enables persons to – place or accept, through the betting exchange operator, wagers with other persons; or the betting exchange operator wagers place with that, on acceptance, are matched with opposing wagers placed with and accepted by the operator (so as to offset all risk to the operator)". 68 The licence was surrendered and replaced on 25 May 2007. 69 In s 76ZDB. Kirby Hayne Division 5 of Pt 4A was added to the Tasmanian Act by the Gaming Control Amendment (Betting Exchange) Act 2005 (Tas) ("the 2005 Tasmanian Act"). The conduct of a gaming activity in accordance with, and subject to, a licence granted and in force under Pt 4A is rendered lawful by s 76A; this provision operates to lift what otherwise would be the operation of "any other law". In the Second Reading Speech in the Legislative Assembly on the Bill for the 2005 Tasmanian Act, the Treasurer said that the decision to license betting exchanges had not been made lightly and added: "In making this decision the Government has weighed up all the arguments. We have listened to the wide-ranging views held on betting exchanges. We have considered arguments about probity, integrity, funding for the racing industry and about jobs for Tasmanians. On all of these essential elements the Government believes that the licensing of betting exchanges is the right decision." He said later in his speech: "As part of the extensive probity and integrity measures to be applied to betting exchanges, only registered persons will be able to use the betting exchange services. The requirement for the completion of a registration check similar to the banks' 100-point check will ensure that there is a complete audit trail of the betting activity of individuals. An important part of the legislation before the House is the requirement that any licensed betting exchange must, for the purpose of ensuring the probity of brokered wagering and brokered wagering events, furnish regulatory agencies with such information in such time and manner as the Tasmanian Gaming Commission instructs the licensed betting exchange. There are a number of other important integrity and probity provisions included in this bill. These include: the prevention of wagering on illegal events; the capacity of the Gaming Commission to disallow any betting exchange rules on a number of bases including that they are deemed to be oppressive and unfair; Kirby Hayne Crennan the capacity for the betting exchange to freeze player funds immediately where inappropriate activity is suspected; and . the prevention of wagering on any event which the Commission considers is not a fit subject for betting exchange wagering. Not only are these strong probity and integrity requirements supported by heavy penalties for individuals found to breach the requirements but heavy penalties can also be imposed on the licensed betting exchange operator. This bill provides for a licensed betting exchange to be subject to fines of up to $10 million and loss of licence for the breach of their conditions of licence. This level of penalty reflects the importance which the Government has placed on ensuring the integrity and probity of betting exchange operations." With respect to matters of finance the Treasurer said: "[T]o ensure that funding to the racing industry is not compromised, there will be a requirement that betting exchange operators underwrite the level of funding to the industry at its 2004-05 level. This requirement will remain in place for five years and will be set out in regulations. In addition, Betfair will be required to pay an upfront contribution of $5 million to the Tasmanian racing industry in the first year of operation covered by a deed of agreement between the Crown and Betfair. It will also be required to guarantee $5 million in taxes and product fees in the second year over and above the guaranteed funding level. The latter requirement will be set out in regulations. That is, the Tasmanian racing industry will receive an additional $5 million in each of the first two years of operation compared to what it would have otherwise received. However, funding levels are expected to exceed this amount in the future. Should Betfair's share of the market reach 4 per cent, it is estimated that the operation of Betfair Australia will provide, by 2009-10, an additional $35 million to $40 million a year to the Tasmanian racing industry." The law in Western Australia At all material times, the only authorised wagering operations sited in Western Australia have been licensed bookmakers, on-course totalisators Kirby Hayne operated principally by racing and turf clubs, and the authority known as RWWA which is established by s 4 of the Racing and Wagering Western Australia Act 2003 (WA) ("the RWWA Act"). With respect to the law of Western Australia, Mr Erceg had been at liberty to bet as he did before 29 January 2007 as a Betfair "registered player", by reason of the "offshore betting" provision then made by s 27A of the Betting Control Act 1954 (WA) ("the WA Act"). At that stage, Betfair qualified (along with out-of-State licensed bookmakers and totalisator agencies) as an "authorised person" for s 27A because it was authorised under the law of another State or Territory to engage in or conduct betting on races70. That remains the position of Betfair under the laws of the other Australian States. However, since 29 January 2007 it has ceased to be so under the WA Act. Hence this litigation. On 29 January 2007 some of the critical provisions of the Betting and Racing Legislation Amendment Act 2006 (WA) ("the 2006 WA Act") commenced71. This statute made amendments and additions to the WA Act, the validity of some of which the plaintiffs challenge. As s 27A now stands, it still remains open to a person in Western Australia, such as Mr Erceg, to make bets with bookmakers and totalisator organisations authorised under the law of another State or Territory. This acceptance by Western Australia of the licensing systems of the other States and Territories reflects what has been called the "Gentleman's Agreement" between these polities. All wagering operations are free to accept bets on events held in any State or Territory, but each polity collects fees and taxes only from wagering operators which they have licensed. However, as a result of the changes made by the 2006 WA Act, Western Australia alone has legislated a special regime in respect of betting exchanges. 70 The "offshore betting" provision in s 27A of the WA Act was amended in 2006 so that an "authorised person" includes a person authorised by the law of another State or Territory to engage in or conduct betting on sporting events, as well as on races. 71 The new sections 27B, 27C and 27D had not commenced when the Further Amended Statement of Claim was filed on 28 May 2007. That did not make the institution of the present litigation premature: Croome v Tasmania (1997) 191 CLR 119 at 135. In any event, these provisions commenced on 9 July 2007, before the hearing of the Amended Special Case. Kirby Hayne Crennan The first relevant provision introduced into the WA Act by the 2006 WA Act is s 27B(1). This states: "A person who establishes or operates a betting exchange commits an offence. Penalty: $10,000, or 24 months imprisonment, or both." The term "betting exchange" is defined in s 4AA in terms resembling those in the Tasmanian Act and applicable to Betfair. However, s 4AA concludes with the words: "but does not include a facility, electronic or otherwise, that enables persons to place bets only with a bookmaker or a totalisator". It should be added that when used in the WA Act the phrase "to bet" is so defined (s 4) that the event or contingency must be with respect to any horse or greyhound race or sporting event in relation to which betting is authorised under that statute. The first of the two provisions the validity of which the plaintiffs challenge is s 24(1aa). This states: "A person who bets through the use of a betting exchange commits an offence. Penalty: $10,000, or 24 months imprisonment, or both." This provision must be read with ss 12 and 13 of the Criminal Code (WA) ("the Code"). The result of the operation of s 12 of the Code is that it is sufficient that at least one of the acts that make up the elements necessary to constitute the offence under s 24(1aa) of the WA Act occurs in Western Australia72. Thus, s 24(1aa) would be attracted by the use by Mr Erceg in Western Australia of a computer to place bets with Betfair. Secondly, s 13 of the Code would render Betfair liable for aiding, counselling or procuring an offence under s 24(1aa) even if all of the acts of Betfair occurred outside Western Australia. 72 Pinkstone v The Queen (2004) 219 CLR 444 at 453-454 [16], 464 [55]-[56]; [2004] HCA 23. Kirby Hayne The second provision challenged by the plaintiffs is s 27D(1). Section 27D(1) of the WA Act reads: "A person to whom this section applies who, in this State or elsewhere, publishes or otherwise makes available a WA race field in the course of business commits an offence unless the person – is authorised to do so by an approval; and complies with any condition to which the approval is subject. Penalty: $5000." The information comprising a "WA race field" in the ordinary course of events would be readily available to the public, at least from sources in the print media. This is apparent from the terms of the definition in s 27C(1) of the expression "WA race field". The expression means: "information that identifies, or is capable of identifying, the names or numbers of the horses or greyhounds – that have been nominated for, or that will otherwise take part in, an intended race to be conducted in this State; or that have been scratched or withdrawn from an intended race to be conducted in this State". The prohibition imposed by s 27D(1) applies to persons including those who in Western Australia "or elsewhere" act as a bookmaker, conduct betting by the operation of a totalisator, or operate a betting exchange (s 27C(2)). Provision is made in s 27D(2)-(7) for the Minister to grant, suspend, and revoke approvals. Betfair holds no such approval. Its application was refused by the Minister on 8 October 2007. In her written reasons for the refusal the Minister said that she had had regard to the regulatory policy of the WA Act as now stated in the Act's long title. That title had been amended by the 2006 WA Act to include in the objects of the WA Act, "to prohibit betting through, and the establishment and operation of, betting exchanges". Kirby Hayne Crennan Something should be said here of the significant position occupied by RWWA. The effect of s 27C(3) of the WA Act is that, regardless of what otherwise might be the case, the prohibition upon publication of WA race fields which is imposed by s 27D has no application to RWWA in respect of the performance of its functions in accordance with the RWWA Act. Trading variously as "TAB", "Ozbet" and "Sportsbet", RWWA has established totalisator agencies at locations in Western Australia, a telephone call centre and an internet facility for the making of wagers at fixed price odds on horse and greyhound races and sporting events in Western Australia and elsewhere. The total turnover in 2005-2006 for RWWA for all bets was $1,324,196,000, and for internet bets was $109,800,000. (For bookmakers the total turnover for all bets was $102,790,000 and for telephone and internet bets it was $26,976,000; for on-course totalisators the turnover was $75,283,000.) RWWA does not conduct a betting exchange. Counsel for Western Australia submitted (and the plaintiffs disputed) that as the RWWA Act presently stands it has no power to conduct a betting exchange and, in any event, if it sought to do so it would be faced by the general prohibition upon betting exchanges now imposed by s 27B(1) of the WA Act. The case may be decided on the footing that these submissions by Western Australia are correct. But the presence of s 27B(1) does not meet the point that RWWA and Betfair competed before 29 January 2007 for wagers placed by internet and telephone and but for the changes then instituted by statute would have continued to do so. Fees and levies RWWA is a "State/Territory body" within the meaning of Pt III, Div 1AB of the Income Tax Assessment Act 1936 (Cth) and as such is exempt from income tax. At the State level, RWWA pays a special tax levied on moneys received by it on wagers made. This is fixed by the Racing and Wagering Western Australia Tax Act 2003 (WA) as five per cent in respect of totalisator wagers and 11.91 per cent in respect of off-course wagers. RWWA has been obliged since 31 July 2006 to allocate its funds in the manner specified in s 106 of the RWWA Act. This includes provision for grants and loans to racing clubs and payments or credits to thoroughbred, harness and greyhound racing clubs registered with RWWA. Kirby Hayne In Western Australia, licensed bookmakers are required to pay a "betting levy" to the racing club on whose racecourse the licensee carries on business; the levy is (a) 0.5 per cent of betting turnover in respect of approved sporting events and (b) two per cent of other betting turnover. The racing club must retain 50 per cent of the amounts received in respect of (a) and all amounts received under (b), and may apply the amount retained to such purposes as the club thinks fit. The balance must be remitted to the Gaming and Wagering Commission ("the Commission") established by statute in 1987. The operator of an on-course totalisator must pay to the Commission an annual licence fee at a prescribed rate assessed on total turnover during the preceding year. The Amended Special Case The Amended Special Case reserves for the opinion of the Full Court questions framed to encapsulate the several grounds upon which the plaintiffs assert the constitutional invalidity of s 24(1aa) and s 27D(1). First, the plaintiffs seek declaratory relief that s 24(1aa) of the WA Act is invalid to the extent that it otherwise applies to a person who makes or accepts offers to bet through the use of Betfair's betting exchange, by means of telephone or internet communications between a place in Western Australia and the Hobart premises of Betfair. They also seek declaratory relief that s 27D(1) of the WA Act is invalid to the extent that it otherwise applies to the conduct of Betfair in publishing or otherwise making available a WA race field, whether by way of telephone or internet communication between its Hobart premises and a place in another State, or for the purpose of making or receiving offers through the use of the Betfair betting exchange by telephone or internet communication between its Hobart premises and a place in another State. The plaintiffs (with the support of Tasmania) submit that these provisions are rendered invalid in their application to the operation of the Betfair betting exchange by s 92 of the Constitution. A further challenge is made to the validity of s 27D(1), which it will be recalled proscribes certain acts committed in Western Australia "or elsewhere", and, the plaintiffs contend, thereby purports to prohibit Betfair from engaging in conduct authorised by its licence under the Tasmanian Act in Tasmania and elsewhere. This operation of s 27D(1) is said to be rendered invalid or inoperative by either or both of the "full faith and credit" provision of s 118 of the Constitution, and an implication drawn from the text and structure of the Constitution and restraining such an extraterritorial reach of State legislative power. Kirby Hayne Crennan The Amended Special Case may be disposed of without ruling on these grounds of further challenge to the validity of s 27D(1). This is because the plaintiffs should have the declaratory relief they seek respecting the invalidity of s 24(1aa) and s 27D(1), by reason of the operation of s 92. State regulation In explaining the reasons for that outcome, it is convenient first to consider a particular proposition drawn from Castlemaine Tooheys73. Western Australia, and supporting interveners, rely upon that proposition for a sufficient answer to the success the plaintiffs otherwise might have in demonstrating that the impugned provisions are discriminatory in a protectionist sense. In their joint reasons in Castlemaine Tooheys, Mason CJ, Brennan, Deane, Dawson and Toohey JJ said that account must be taken of a "fundamental consideration"74. This was that each State legislature has power "to enact legislation for the well-being of the people of that State". Western Australia submits that the legislation under attack by the plaintiffs is of this character. But such State legislative power, as their Honours also said in Castlemaine Tooheys, must be "subject to the Constitution". Section 92 applies in peremptory terms and (unlike, for example, s 51) it is not restrained by the presence of those opening words. By way of contrast, the Melbourne Corporation doctrine applies to the exercise of federal legislative powers and the implication involved finds some textual root in the phrase in the opening words of s 51, "subject to this Constitution". There is to be found in s 92 no such textual root for any implication saving legislation (and the policies it may implement) from the full operation which that provision otherwise has in any given case. That is not a cause for surprise when regard is had to the operation of s 92 in the maintenance of a national economy. Further, such a state of affairs is consistent with those pre-1900 United States decisions to which reference has been made earlier in these reasons. 73 (1990) 169 CLR 436. 74 (1990) 169 CLR 436 at 472. Kirby Hayne There are difficulties, also as noted above at [18], in the use in Castlemaine Tooheys of the expression "the people of" a State. The State laws under challenge here apply not merely to those citizens who are resident in Western Australia75, but to any person present there at any time. Thus, the "fundamental consideration" identified in Castlemaine Tooheys of a condition of localised well-being will not encompass much modern State regulatory legislation in the "new economy". This is so particularly where the State law is given a "long-arm" territorial reach of the kind considered in Pinkstone v The Queen76. Perhaps more "fundamental consideration" proceeds from circular reasoning. This will be so, unless the circle be broken and the postulated limitation found in the text of s 92 itself, albeit by some gloss upon the words "absolutely free". significantly, it appears that the Attempts of this kind were made in cases decided before Cole v Whitfield77. Barwick CJ saw s 92 as applying "in a society based on free competition in trade", in the sense "that freedom is understood in organized and civilized societies"; the consequence was that laws dealing with fraudulent or deceptive conduct in trade and with monopolisation would be "compatible" with that freedom78. Earlier, in Mansell v Beck79, Taylor J observed that from the moment of first European settlement lotteries could not be conducted except in violation of law and that it was difficult to see how such activities ever had assumed in Australia the character of trade and commerce. No such submission was made respecting the forms of gambling with which this case is concerned. Given the evidence respecting the extensive revenues presently provided to government from licensed gambling, such a submission would have been at best incongruous. 75 cf Constitution, s 117. 76 (2004) 219 CLR 444. 77 (1988) 165 CLR 360. 78 Samuels v Readers' Digest Association Pty Ltd (1969) 120 CLR 1 at 19-20. 79 (1956) 95 CLR 550 at 596. Kirby Hayne Crennan Much of what was said in the older cases respecting the failure of s 92 to reach quarantine and inspection laws seems to have been based upon a perception of the "true nature" of such legislation as aids not hindrances to interstate commerce80. On the other hand, Evatt J looked for "postulates or axioms demanded alike by the dictates of common sense and by some knowledge of what was being attempted by the founders of the Australian Commonwealth"; this supported the validity of laws suppressing or restricting, "in the public interest", the practice of gambling81. At first blush, the reference by Evatt J to what was attempted by those who drew the Constitution might provide support for a gloss upon s 92 which would be consistent with what was said in Castlemaine Tooheys and would build upon a distinction apparently first drawn by Marshall CJ in Gibbons v Ogden82. Marshall CJ there distinguished between "commerce" and "police" regulation. The latter was a residual aspect of sovereignty not surrendered by the States to Congress. The Chief Justice spoke of "[t]he acknowledged power of a state to regulate its police, its domestic trade, and to govern its own citizens". A dichotomy, conclusory in nature, then was established in the United States decisions83 between State laws invalid as regulation of interstate commerce and those valid as "police power regulation". The Supreme Court developed a doctrine which left the States free to regulate those aspects of commerce so local in character as to demand diverse treatment. In Cooley v Board of Wardens of the Port of Philadelphia84 it was held that the engagement of local pilots by ships leaving or entering that port was a matter of "local" rather than "national" regulation. But, even so, such regulations could not discriminate between ships from different States85. 80 See the reasons of the Privy Council in James v The Commonwealth (1936) 55 CLR 1 at 52-53; [1936] AC 578 at 623-625. 81 R v Connare; Ex parte Wawn (1939) 61 CLR 596 at 620-621. 82 22 US 1 at 208 (1824). 83 By such cases as Willson v Black-bird Creek Marsh Co 27 US 245 (1829). 85 See Spraigue v Thompson 118 US 90 (1886). Kirby Hayne Whilst these doctrines were current when s 92 was framed86, they would sit uncomfortably with the text of s 92 as adopted and provide an unsatisfactory basis today for the "fundamental consideration" discerned in Castlemaine Tooheys. They proceeded from a view taken from time to time in the United States of distinct and dual sovereignty which in Australia the Court has not accepted for over 80 years. In addition, as Wynes emphasised87, the "police power" of the States operated as a check upon the exclusive nature of federal legislative power found in the Commerce Clause, whereas s 51(i) of the Constitution is not such a power. Further, as this case illustrates, what is purely "local" commerce today may not be readily distinguished at any practical level from interstate commercial activity. In Castlemaine Tooheys their Honours continued88: "It would extend the immunity conferred by s 92 beyond all reason if the Court were to hold that the section invalidated any burden on interstate trade which disadvantaged that trade in competition with intrastate trade, notwithstanding that the imposition of the burden was necessary or appropriate and adapted to the protection of the people of the State from a real danger or threat to its well-being. And it would place the Court in an invidious position if the Court were to hold that only such regulation of interstate trade as is in fact necessary for the protection of the community is consistent with the freedom ordained by s 92. The question whether a particular legislative enactment is a necessary or even a desirable solution to a particular problem is in large measure a political question best left for resolution to the political process." This passage may present some obscurities. If a criterion of validity of legislation is possession of a particular attribute, then Ch III of the Constitution commits to the federal judicial power the determination of that issue. Further, it may be noted that in Castlemaine Tooheys their Honours went on to answer 86 Cooley, The General Principles of Constitutional Law in the United States of America, (1880) at 74-75. 87 Wynes, Legislative, Executive and Judicial Powers in Australia, 5th ed (1976) at 88 (1990) 169 CLR 436 at 472-473. Kirby Hayne Crennan adversely to South Australia the ultimate questions, which they identified in conventional terms as follows89: "[T]he validity of the 1986 legislation rests on the proposition that the legislative regime is appropriate and adapted to the protection of the environment in South Australia from the litter problem and to the conservation of the State's finite energy resources and that its impact on interstate trade is incidental and not disproportionate to the achievement of those objects." (emphasis added) Neither the plaintiffs nor Tasmania challenged the existence of a "fundamental consideration" of the general nature discerned in Castlemaine Tooheys. Accordingly, further attention to its derivation from and place in the Constitution is not required here. However, with respect to the "appropriate and adapted" criterion expressed in Castlemaine Tooheys, counsel for the plaintiffs and for Tasmania submitted that necessarily it involves the existence of a "proportionality" between, on the one hand, the differential burden imposed on an out-of-State producer, when compared with the position of in-State producers, and, on the other hand, such competitively "neutral" objective as it is claimed the law is designed to achieve. That "proportionality" must give significant weight to the considerations referred to earlier in these reasons when discussing Castlemaine Tooheys90. These involve the constraint upon market forces operating within the national economy by legal barriers protecting the domestic producer or trader against the out-of-State producer or trader, with consequent prejudice to domestic customers of that out-of-State producer or trader. They suggest the application here, as elsewhere in constitutional, public and private law, of a criterion of "reasonable necessity"91. For example, in North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW92, Mason J said: 89 (1990) 169 CLR 436 at 473-474. 90 (1990) 169 CLR 436 at 468-470. 91 See the discussion by Gleeson CJ in Thomas v Mowbray (2007) 81 ALJR 1414 at 1428-1429 [20]-[26]; 237 ALR 194 at 208-209; [2007] HCA 33. 92 (1975) 134 CLR 559 at 608. Kirby Hayne "As the defendant has failed to show that the discriminatory mode of regulation selected is necessary for the protection of public health, it is in my judgment not a reasonable regulation of the interstate trade in pasteurized milk." His Honour also referred93 to remarks in a similar vein by the Privy Council in The Commonwealth v Bank of NSW94. That view of the matter should be accepted as the doctrine of the Court. It is consistent with the explanation given in Cole v Whitfield95 of the justification of the total prohibition in the Tasmanian legislation on the sale of all undersized crayfish, irrespective of origin, as supplied by its objective of the conservation of the stock of Tasmanian crayfish. The Court held96 that the prohibition was a "necessary means of enforcing the prohibition against the catching of undersized crayfish in Tasmanian waters" because that State "cannot undertake inspections other than random inspections and the local crayfish are indistinguishable from those imported from South Australia". Further reference also should be made here to the resolution in Castlemaine Tooheys97 by Mason CJ, Brennan, Deane, Dawson and Toohey JJ of the question of the validity of the South Australian legislation at stake there. They concluded from the facts, that the legislature of that State had "reasonably apprehended" that the sale of beer in non-refillable bottles manufactured in South Australia constituted a threat to the reserves of that State of natural gas98. Their Honours then said that it might have been expected that State legislation would have prohibited the sale in South Australia of beer in non-refillable bottles produced in that State. They went on to note that an alternative measure might have been the prohibition of the manufacture in South Australia of such bottles, 93 (1975) 134 CLR 559 at 615. 94 (1949) 79 CLR 497 at 640-641; [1950] AC 235 at 311. 95 (1988) 165 CLR 360 at 409-410. 96 (1988) 165 CLR 360 at 409-410. 97 (1990) 169 CLR 436 at 477. 98 (1990) 169 CLR 436 at 477. Kirby Hayne Crennan either at all, or with the use of natural gas. However, neither of these measures was adopted. With that in mind, their Honours concluded99: "Instead a regime was introduced which subjected the Bond brewing companies' interstate trade to serious competitive disadvantages by reason of their selling beer in non-refillable bottles, even though those bottles are manufactured outside the State and do not, as far as we know, involve the use of South Australian natural gas. ... [N]either the need to protect the environment from the litter problem nor the need to conserve energy resources offers an acceptable explanation or justification for the differential treatment given to the products of the Bond brewing companies. Accordingly, in our view, that treatment amounted to discrimination in a protectionist sense in relation to their interstate trade." (emphasis added) Acceptable explanation or justification? The reasons for the policy adopted by Western Australia were spelled out in the legislative preamble as being "to prohibit betting through, and the establishment and operation of, betting exchanges". Those reasons had been expressed earlier by an answer given by the Minister for Racing and Gambling to a question asked in the Legislative Assembly on 4 May 2005. The Minister had said: "The racing industry is very important to the state of Western Australia. It is one of the six biggest industries in the state. It employs thousands of citizens across the state. It provides a great deal of interest and enjoyment for many hundreds of thousands of Western Australian citizens. ... The reasons we are opposed to betting services are that, first, they make no contribution to the racing industry in Australia and, secondly, betting exchanges allow punters to bet on any of the racing codes and lose. That means that the integrity of the racing industry is put under threat by betting exchanges. They are absolutely opposed by all three racing They are opposed by the industry codes in Western Australia. 99 (1990) 169 CLR 436 at 477. Kirby Hayne government. They are opposed by virtually all state governments. However, we have a problem: we cannot control the Internet. We have written to the federal government and to the minister for communications asking whether she will ensure that betting exchanges are made illegal under the Interactive Gambling Act. She has declined to do so." (emphasis added) First, as to the absence of contribution to the racing industry in Australia, so far as that may be relevant. The evidence shows that by agreement with the Victorian regulator, Betfair undertook to return an amount equivalent to one per cent of the value of bets taken by it on races in Victoria; this is the same level of return as that required from bookmakers in that State. Betfair has been meeting that obligation. There is no reason to doubt the assertion by Betfair that it remains ready to undertake obligations of this kind in Western Australia and to ensure that the organisers of races in that State obtain a reward from Betfair as well as from other wagering operators in that State. In its submissions Western Australia also contended that any practical effect of the impugned legislation in protecting the turnover of in-State operators from diminution as a result of competition from Betfair, with consequent prejudice to the returns to the racing industry and in-State revenue provided by it, could not be protectionist in nature. But a proposition which asserts that an object of revenue protection of this kind may justify a law which discriminates against interstate trade is contrary to authority100. And it is contrary to principle, for such a justification, if allowable, would support the re-introduction of customs duties at State borders. Much effort on this branch of the case was expended in developing the second reason to which the Minister referred in the above passage. This was to the effect that Betfair's operations, if permitted by the law of Western Australia, would or would be likely to have, or were reasonably apprehended to have, an adverse effect upon the integrity of the racing industry conducted in that State. It was said to be easier to lose a multiparty sporting event than to win it. To permit punters to back an entrant to lose rather than to win, as does Betfair, was said in the Report to pose a threat to the integrity of the process above that which might be thought to be present already in the racing industry. It was this alleged threat 100 Bath v Alston Holdings Pty Ltd (1988) 165 CLR 411 at 426-427; Sportodds Systems Pty Ltd v New South Wales (2003) 133 FCR 63 at 80. Kirby Hayne Crennan to the integrity of the racing industry which was said by Western Australia to justify the course taken by its legislation. What is involved here is an attempt at an evidentiary level to measure something of an imponderable. But, allowing for the presence to some degree of a threat of this nature, a method of countering it, which is an alternative to that offered by prohibition of betting exchanges, must be effective but non-discriminatory regulation. That was the legislative choice taken by Tasmania and it cannot be said that that taken by Western Australia is necessary for the protection of the integrity of the racing industry of that State. In other words, the prohibitory State law is not proportionate; it is not appropriate and adapted to the propounded legislative object. Part 4A of the Tasmanian Act contains the detailed regulatory provisions which the Treasurer had outlined. It does not discriminate against interstate trade and commerce. Counsel for Tasmania points to evidence which indicates that the prescribed standards have been fully satisfied by Betfair. Seen from the other perspective, there was a lack of evidence of any increase in Australia of dishonest practices attributable to the operation of the betting exchange by Betfair. It will be recalled that Betfair's exchange remains accessible under the laws of the other States. In that setting, it cannot be found in this case that prohibition was necessary in the stated sense for the protection or preservation of the integrity of the racing industry. Both the plaintiffs and Tasmania put the case initially at the level that the protection of integrity was not a "substantial purpose" or "the real object" of the legislation. It is unnecessary to decide the case by ruling on that submission. This is because these parties also submitted that even if that object be seen as legitimate, the means adopted, prohibition, was not appropriate and adapted to achieve it given the avenue of regulation in a non-discriminatory manner. The market The evidence shows that there is a developed market throughout Australia for the provision by means of the telephone and the internet of wagering services on racing and sporting events. Indeed, the evidence shows that such a market may be international. Within the Commonwealth the events may take place in one State, the customer be in another and the licensed bookmaker or TAB be in a third. Before the commencement of the legislation of Western Australia which is Kirby Hayne under challenge, this market included the services supplied by the betting exchange which Betfair had established under licence in Tasmania. In the other States this remains the case. The inhibition to competition presented by geographic separation between rival suppliers and between supplier and customer is reduced by the omnipresence of the internet and the ease of its use. The apprehension expressed in the Report as to the operations of betting exchanges, with lower commission rates, upon the revenue streams derived by TABs and licensed bookmakers, is indicative of cross-elasticity of demand and thus of close substitutability between the various methods of wagering101. The effect of the legislation of Western Australia is to restrict what otherwise is the operation of competition in the stated national market by means dependent upon the geographical reach of its legislative power within and beyond the State borders. This engages s 92 of the Constitution. It is now convenient to determine whether the plaintiffs are entitled to the relief they seek respecting the two provisions under challenge. Section 27D(1) This provision applies to the conduct of Betfair in publishing or otherwise making available a WA race field. This burdens interstate trade and commerce, both directly and indirectly. It does so directly because it denies to Betfair use of an element in Betfair's trading operations. It does so indirectly by denying to Betfair's registered players receipt and consideration of the information respecting the latest WA race fields by access to Betfair's website or by communication with its telephone operators. These effects of s 27D(1) operate to the competitive disadvantage of Betfair and to the advantage of RWWA and the other in-State wagering operators. The law in its application to Betfair answers the description of a discriminatory burden on interstate trade of a protectionist kind. The provision for authorisation may be put to one side so far as concerns Betfair. Given the stated legislative purpose of prohibition of betting through and the establishment and operation of betting exchanges, a matter to which the 101 See Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 215 CLR 374 at 455 [250]. Kirby Hayne Crennan Minister is bound to have regard when considering an application under s 27D, the prospect of Betfair obtaining approval must be illusory. The evidence of the refusal of the application which Betfair made bears this out. Section 24(1aa) The relevant effect of this provision is to prohibit a person in Western Australia from placing a particular form of fixed odds bet by means of a cross-border electronic communication, and to render the out-of-State wagering operator liable for aiding, counselling or procuring an offence by Betfair's registered players even if all its acts occurred outside Western Australia. It is true that this particular form of fixed odds betting also is denied to in-State wagering operators and their customers. But that does not deny to s 24(1aa) its character of a discriminatory burden on interstate trade of a protectionist kind. The sub-section operates to protect the established wagering operators in Western Australia, including RWWA, from the competition Betfair otherwise would present. What has been said above respecting cross-elasticity of demand is relevant here. The intrastate trade and interstate trade are of "the same kind"102, whether the subject matter be different species of fixed odds betting or the general field of wagering upon racing and sporting events. the evidence That view of the matter proceeds from indicating cross-elasticity of demand. Some analogy is provided by the situation in Castlemaine Tooheys103. There the discrimination was between bottles having different characteristics; here it is between different but competing forms of wagering on racing and sporting events. The effect of s 24(1aa) is to prohibit Betfair, an out-of-State wagering operator, from providing a betting exchange for registered players in Western Australia, leaving the in-State operators able to supply customers with their services without the competition to their revenue which Betfair would present. This is another discriminatory burden of a protectionist kind. 102 Cole v Whitfield (1988) 165 CLR 360 at 407-408; Barley Marketing Board (NSW) v Norman (1990) 171 CLR 182 at 204-205. 103 (1990) 169 CLR 436. Kirby Hayne Other grounds The foregoing conclusions make it unnecessary to consider whether s 27D(1) is invalid by reason of the alleged direct conflict between it and the authority given to Betfair by its licence under s 76A of the Tasmanian Act. This is not the occasion to consider what may be the controlling constitutional principles were there demonstrated to be such a clash of State legislation. Orders The plaintiffs have succeeded in their reliance upon s 92 of the Constitution and are entitled to declaratory relief in the particular form identified earlier in these reasons. Western Australia submitted that the appropriate outcome respecting s 24(1aa) would be to read it down so as not to apply to betting in the course of interstate trade and commerce and thus leave it to apply to betting in intrastate trade and commerce or betting in trade and commerce with other countries. However, rather than thereby attempt textual reconstruction of s 24(1aa), the preferable course is to grant to the plaintiffs declaratory relief in the limited form indicated. Given the absolute terms and penal effect of the impugned provisions, it might exceed the function of the Court to re-express them104. The costs of the plaintiffs of the Amended Special Case should be borne by Western Australia. Question 1 should be answered: "Section 24(1aa) of the Betting Control Act 1954 (WA) is invalid to the extent that it would apply to a person including the second plaintiff, who makes or accepts offers to bet through the use of the first plaintiff's betting exchange by telephone or internet communication between a place in Western Australia and the Tasmanian premises of the first plaintiff." Question 2 should be answered: 104 See Pidoto v Victoria (1943) 68 CLR 87 at 109; Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 339; Victoria v The Commonwealth (1996) 187 CLR 416 at Kirby Hayne Crennan "Section 27D(1) of the Betting Control Act 1954 (WA) is invalid to the extent that it would apply to conduct of the first plaintiff in publishing or otherwise making available a WA race field: by way of telephone or internet communication between the Tasmanian premises of the first plaintiff and a place in another State; or for the purpose of making or receiving offers to bet through the use of the first plaintiff's betting exchange by telephone or internet communication between the Tasmanian premises of the first plaintiff and a place in another State." Question 3 should be answered: "Unnecessary to answer." 130 HEYDON J. The background is set out in the joint judgment105. So are s 92 of the Constitution106 and the legislation it is alleged to invalidate107. The plaintiffs correctly submitted that where the practical effect of a law is to burden inter-State trade to a significantly greater extent than it burdens intra- State trade, the law contravenes s 92 unless there is some other end achieved by the law which is compatible with s 92. The plaintiffs further submitted that the practical effect of both s 24(1aa) and s 27D(1) is to burden inter-State trade to a significantly greater extent than each burdens intra-State trade, and that there was no other end achieved by each provision which is compatible with s 92. These submissions are correct for both s 24(1aa) and s 27D(1). The validity of s 24(1aa) Section 24(1aa) isolates for prohibition certain types of trading activity. It prohibits a gambler in Western Australia from placing a particular type of bet. Hence, when read with s 13 of the Criminal Code (WA), it prohibits persons offering gamblers the facility of betting in that way, whether those persons carry out any act in Western Australia or not. Western Australia relied on the fact that the legislation prevented persons in Western Australia from betting through a betting exchange whether that exchange operated from Western Australia or elsewhere. That is, it prevented Western Australian traders from employing a betting exchange in their trade as much as it prevented non-Western Australian traders from doing so. However, the prohibitions on trading activity created by s 24(1aa) do burden inter-State trade to a significantly greater extent than they burden intra-State trade. This is because they protect the Western Australian traders who offer gamblers the facility of betting from the rivalry they would otherwise face from inter-State traders employing the prohibited forms of trading activity. The trading activity prohibited and the trading activity protected are not identical, but they are each part of the same overall trading activity – offering facilities to gamblers to bet. Western Australia argued that s 24(1aa) was not invalid by reason of s 92, because it advanced the end of preserving the integrity of racing in Western Australia by preventing persons who have the twin characteristics of possessing the capacity to affect adversely the performance of a horse in a race and 105 At [1]-[9] and [75]-[81]. possessing the desire to profit from that capacity by laying a bet that it will lose, from doing so. That argument must be rejected. The width of the technique adopted in s 24(1aa) reveals that that is not the end advanced. The technique adopted was a prohibition on a very wide class of would-be gamblers – persons in Western Australia who might wish to place a back bet or a lay bet on a horse race or any sporting event anywhere in the world – from doing so. The technique employed is wider than the end advanced in not being limited to horse racing, but in extending to sporting events in relation to which no "integrity" problems have been claimed. Thus s 24(1aa) cannot advance the integrity of horse racing in Western Australia by preventing Western Australians from betting in a particular way on a tennis match in Sydney or a cricket match in Adelaide where the organisers of those events do not object to betting in that particular way. Further, the technique employed is wider than the end advanced in not being limited, as Western Australia's formulation of that end is limited, to horse racing in Western Australia: it extends to horse racing anywhere. Section 24(1aa) cannot advance the integrity of horse racing in Western Australia by preventing Western Australians from betting in a particular way on a Melbourne horse race where the organisers of that race do not object to betting in that particular way. And the technique is not limited to the very narrow class of persons who might wish to exploit a capacity to affect adversely the performance of a horse in a race by laying a bet on it to lose, but extends to the much wider class of would-be gamblers described above. So wide is the technique adopted – so ill-suited is it to achieve the end supposedly advanced – that it must be inferred that the only purpose is protectionist. Hence s 24(1aa) is invalidated by s 92. The validity of s 27D(1) The plaintiffs advanced the following arguments in relation to s 27D(1). The sub-section, in prohibiting unlicensed persons from publishing or otherwise making available a WA race field, prevents persons in the position of the first plaintiff from engaging in the trade of offering facilities to bet in the fashion they desire while leaving other persons, particularly Western Australian rivals of persons in the position of the first plaintiff, free to trade in that fashion. That consequence flows for the following reasons. Before giving approval under s 27D(2) the Minister is to have regard to the prescribed criteria: s 27D(5). Section 33(1) enables the Governor to make regulations "prescribing all matters that are required or permitted by this Act to be prescribed, or are necessary or convenient to be prescribed for giving effect to the purposes of this Act". By the Betting Control Amendment Regulations (No 2) 2007 (WA), the Betting Control Regulations 1978 the commencement of s 27D on 9 July 2007. The amendments prescribe criteria for the purpose of s 27D(5) (reg 99) and also require an application for approval to be in a form prescribed by the Minister (reg 100). The criteria prescribed for the purpose of s 27D(5) include the criterion that the applicant for approval is authorised to conduct wagering by the law of Western Australia or another jurisdiction in which the applicant operates, if the law so requires: reg 99(1)(a). (WA) were amended contemporaneously with They also include the criterion that the Minister is satisfied that the applicant is a "fit and proper person" to hold an approval: reg 99(1)(c). The form prescribed by the Minister under reg 100(1)(a) in Pt A par 4 requires the applicant to provide details of all wagering types intended to be offered or facilitated using WA race fields including full details of any "betting to lose"108. The Guide to Obtaining Approval to Publish/Use Western Australian Race Fields states that the "detail provided in relation to this section [of the form] will be integral in assessing wagering operations". That Guide also states: "An approval given by the Minister (or delegate) does not give automatic right to wagering service providers to publish/use Western Australian race field information. As a condition of an approval, wagering service providers approved must enter into a commercial arrangement with [RWWA] before obtaining Western Australian race field information." The imposition of this condition was anticipated by the Betting and Racing Legislation Amendment Act 2006 (WA) when it amended the Racing and Wagering Western Australia Act 2003 (WA) to confer on RWWA the function of entering into contracts or arrangements for the commercial exploitation of information held by it in relation to racing in Western Australia (s 35(1)(ba)) and the power to provide WA race fields on a commercial basis (s 30(2)(ba)). In short, the plaintiffs contended, since the first plaintiff conducts a betting exchange, since betting through that facility is prohibited by s 24(1aa) and since the first plaintiff facilitates "betting to lose", the first plaintiff is unlikely to experience a favourable exercise of the Minister's discretion to grant approval. It is also within the legislative contemplation that the principal Western Australian rival of the first plaintiff, namely RWWA, would not be likely to enter a commercial arrangement with the first plaintiff. In addition, the legislation favours RWWA over inter-State traders in that s 27C(3) excludes RWWA from the need to obtain authorisation. And the legislation also gave Western Australian bookmakers the benefit of an exemption until 6 August 2007109, 108 The form was prescribed by the Minister under reg 100(1)(a) before 19 June 2007 (when the commencement date of s 27D as 9 July 2007 was proclaimed). 109 Section 27C(4)(a) provides that s 27D does not apply to a person holding a licence under Pt 2 until the day specified under s 27C(5), or 8 July 2008, whichever occurs first. By notice published in the Western Australian Government Gazette, No 149, 20 July 2007 at 3647 pursuant to s 27C(5), the Minister notified 6 August 2007 as the day on and from which s 27D applies to those persons. Hence the exemption lasted until 6 August 2007. thereby favouring them over inter-State traders. In the relevant Second Reading "Local bookmakers will also need to gain an authority and negotiate a fee with RWWA, but the fact that these bookmakers currently contribute to the local racing industry through the payment of a betting levy will be a matter that can be taken into account." According to the plaintiffs, it follows that there are three relevant forms of discrimination created by s 27D(1). The first is that s 27D(1) applies to out-of-State wagering operators but not to in-State wagering operators, namely RWWA and Western Australian bookmakers. In relation to RWWA, that is the direct effect of the exemption in s 27C(3). In relation to Western Australian bookmakers, that is the direct effect of the exemption in s 27C(4) until 6 August 2007. After that date, the practical effect of treating the fact that those bookmakers contribute to the local racing industry through the payment of a betting levy as a matter that can be taken into account in the process of granting approval is that they are more likely to gain approval. The second form of discrimination arises from the need which the prohibition in s 27D(1) creates to obtain approval under s 27D(2). That approval can be withheld as a matter of discretion, whether by reference to the "fit and proper person criterion" or as part of the Minister's residual discretion. Discrimination also arises from the announced intention to treat "betting to lose" as integral to the assessment of a wagering operator as a fit and proper person. The intended practical effect is to prevent or inhibit out-of-State wagering operators, and particularly the first plaintiff, from offering or accepting bets on Western Australian races. The third form of discrimination arises from the imposition, as a condition of approval, of the requirement for a wagering operator to enter into a commercial arrangement with RWWA. The effect is to require an out-of-State wagering operator to enter into a commercial arrangement with a particular in-State wagering operator which is a substantial competitor, if the out-of-State wagering operator is to offer or accept bets on a Western Australian race. Whether or not such commercial arrangement should be entered into, and if so on what terms, are matters left for the legally unreviewable judgment of RWWA. 110 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 21 June 2006 at 4067. In short, the preferential treatment afforded to RWWA, both by its exemption from s 27D(1) and through the intended practical operation of conditional approvals to be granted under s 27D(2), is of its nature preferential treatment afforded to an in-State wagering operator at the expense of any out-of-State wagering operator who seeks to compete with RWWA using the means of publishing or otherwise making available a WA race field. The imposition of a prohibition subject to a discretion to grant permission contravenes s 92 where the mere existence of the prohibition (with or without the discretion) has the immediate practical effect of discriminating in a protectionist way. Thus, the plaintiffs concluded, the intended practical operation of s 27D is as a prohibition on an out-of-State offeror of wagering services to gamblers being able to use as an element of its services information about race fields generated by Western Australian racing operators. It was thus no accident, submitted the plaintiffs, that by 26 October 2007, of the 115 applications for approval to publish or otherwise make available WA race fields made pursuant to s 27D, 110 had been approved, four had not yet been determined and one had been refused – that of the first plaintiff. The Minister's letter refusing approval referred to the first plaintiff's operation of a betting exchange enabling the laying of bets and its supposed impact on the "integrity or perceived integrity of Western Australian races". Western Australia submitted that the period during which Western Australian bookmakers enjoyed exemption from s 27D was only a short one, ending on 6 August 2007, so that any discriminatory effect was spent. Western Australia also submitted that even if it was possible that the discretionary power conferred by s 27D(2) might be exercised in a protectionist fashion, it should not be assumed that it would be; and even if it were so exercised, it would be particular protectionist decisions which were void, not the legislation itself. It also submitted that those decisions were open to administrative and judicial review. Western Australia additionally submitted that if the prohibition by s 24(1aa) on the use of betting exchanges were valid, s 27D(1) could not be rendered invalid by relying on the Minister's power to refuse approval to traders offering a betting exchange. That submission entailed a significant, but inevitable, concession: that the Minister would take into account as an "integral" – a crucial – factor the extent to which an applicant encouraged "betting to lose". The difficulty in the position advocated by Western Australia commences with the fact that it was earlier concluded that s 24(1aa) is invalid. The Minister's capacity to take into account "betting to lose" is a capacity to take into account something which is prohibited, but invalidly. It is true that Western Australian bookmakers only enjoyed exemption from the requirements of s 27D for a short time – between 9 July 2007, when s 27D came into force, and 6 August 2007. But the practical operation of the legislation thereafter was likely to continue to favour them for reasons given by the plaintiffs. The nature of the legislative the purposes of s 27D(5), the regulations scheme contemplated by ss 27C-27F, as revealed by contemporaneously made form the for contemporaneously prescribed under those regulations, and the Guide to that form, reveals that it will have a protectionist effect, and intentionally so. As the plaintiffs submitted, the protectionist prohibition in s 27D(1) could not be saved by granting a discretion to create exemptions, for the "discretion [was] simply a smokescreen for a prohibition". Thus the plaintiffs are correct in submitting that s 27D(1) burdens inter-State trade to a significantly greater extent than it burdens intra-State trade. But does s 27D(1) advance any other end? The answer must be in the negative. Western Australia submitted that the other end advanced was the same as that which it submitted was advanced by s 24(1aa). But like s 24(1aa), s 27D(1) goes so far beyond the end of preserving the integrity of racing in Western Australia as to exclude the possibility of that being its purpose. It is not directed to persons who have the twin characteristics of possessing the capacity to affect adversely the performance of a horse and possessing the desire to profit from that capacity by laying a bet on that horse to lose. Section 27D(1) prevents persons who as a tool of their trade wish to publish or otherwise make available a WA race field from doing so, thereby affecting a class much wider than the class of persons possessing the twin characteristics against which the sub-section is said by Western Australia to be directed. Those who are authorised under s 27D(1) to publish or otherwise make available a WA race field are at liberty to accept back bets or lay bets from the class with the twin characteristics as well as all other persons; those who are not authorised under s 27D(1) also have that liberty, but cannot publish or otherwise make available a WA race field. The mismatch between the technique employed in s 27D and the end supposedly achieved is so great as to prevent that end being treated as its purpose. Western Australia also argued that s 27D(1) had another non-protectionist end. This was the end of ensuring that persons who seek to utilise the horse and greyhound races conducted in Western Australia for the purposes of a wagering business make a contribution to the persons who conduct those races. However, s 27D(1) does not in terms provide for any operator of a wagering business to make any contribution, whether by fee or otherwise, let alone a contribution which was neutral as between traders within Western Australia and traders outside it. Whatever contribution was made would depend on what RWWA stipulated in the commercial arrangement between it and an applicant for s 27D(2) approval, which was contemplated as a condition of approval. Instead of providing in terms for a neutral contribution to the persons conducting Western Australian races, s 27D(1) has a tendency to exclude persons in the position of the first plaintiff, namely would-be entrants from outside Western Australia into the trade of supplying wagering services to gamblers, from that trade. That tendency operates to the advantage of Western Australian suppliers of those services. Orders For those reasons Western Australia's case in relation to s 92 must fail. I agree with the joint judgment that s 24(1aa) should not be read down, and with the answers and orders proposed by the joint judgment.

HIGH COURT OF AUSTRALIA 2 March 2016 STATE OF VICTORIA v TATTS GROUP LIMITED [2016] HCA 5 Today the High Court unanimously allowed an appeal from the Court of Appeal of the Supreme Court of Victoria. The High Court held that Tatts Group Limited ("Tatts") was not entitled to payment by the State of Victoria ("the State") under an agreement between them because a "new gaming operator's licence" was never issued. The appeal was heard concurrently with the appeal in Tabcorp Holdings Ltd v Victoria [2016] HCA 4. In 1992, Tatts was granted a "gaming operator's licence" under Pt 3 of the Gaming Machine Control Act 1991 (Vic) ("the 1991 Act"). That licence was to expire in 2012 and authorised Tatts to conduct gaming on gaming machines at approved venues in Victoria until that time. In 1995, the State and Tatts entered into an agreement ("the 1995 Agreement"). Clause 7 provided for a terminal payment to be paid to Tatts "[i]f the Gaming Operator's Licence expires without a new gaming operator's licence having issued to [Tatts]" but for no amount to be payable if a new gaming operator's licence was not issued at all, or was issued to Tatts or a related entity of Tatts. In 2003, multiple pieces of legislation in Victoria regulating gambling in its various forms, including the 1991 Act, were re-enacted and consolidated into the Gambling Regulation Act 2003 (Vic) ("the 2003 Act"). Tatts retained the authority to carry on gaming operations under its gaming operator's licence on substantially the same terms as under the 1991 Act. In 2008, the Premier of Victoria announced that Tatts' gaming operator's licence would not be renewed upon its expiry. In 2009, the 2003 Act was amended so that no further gaming operator's licences could be issued. The amendments also provided for a new authority called a "gaming machine entitlement" ("GME"). A GME permitted the holder to conduct gaming on an approved gaming machine. 27,500 GMEs were created. They came into effect on 16 August 2012, being the day after Tatts' gaming operator's licence expired. Tatts did not apply for, or receive, any GMEs. The result was that the gaming operations which Tatts conducted under its gaming operator's licence ceased and were then carried on by the holders of GMEs. Tatts claimed it was entitled to payment under cl 7 of the 1995 Agreement. The primary judge found in Tatts' favour, concluding that the reference in cl 7 of the 1995 Agreement to the issue of a "new gaming operator's licence" would have been understood by a reasonable businessperson as the issue of any licence or authority of substantially the same kind as Tatts' existing gaming operator's licence. The Court of Appeal upheld that conclusion. By grant of special leave, the State appealed to the High Court. The High Court allowed the State's appeal and unanimously held that the phrase "new gaming operator's licence" in cl 7 of the 1995 Agreement referred to a gaming operator's licence granted under Pt 3 of the 1991 Act (as it might be amended, re-enacted or replaced from time to time). As a "new gaming operator's licence" was never issued, Tatts was not entitled to payment under cl 7 of the 1995 Agreement.

HIGH COURT OF AUSTRALIA 15 August 2012 [2012] HCA 27 Today the High Court dismissed an appeal by Khalid Baker against his conviction for murder. The Court held that out-of-court confessional statements of the appellant's co-accused, LM, were inadmissible in the appellant's trial. In 2005, the appellant was involved in an altercation at a party in Brunswick, Victoria. In the course of the altercation, a young man crashed through a window and fell to his death. The appellant and LM were charged with murder. On the Crown case, the appellant and LM were acting in concert, or one was aiding and abetting the other. The precise circumstances of the fall were unknown. A push or punch may have projected the deceased through the window, or the window may have shattered as he backed away from the altercation. On either view, the act or acts of the appellant and LM were capable of being the legal cause of death. On the evening of the incident, LM admitted in a police interview that he had pushed the deceased. LM also made statements to witnesses which were capable of being viewed as an admission of responsibility for the deceased's fall. The appellant and LM were jointly tried in the Supreme Court of Victoria. Witnesses gave different versions of the altercation. The appellant sought to rely on LM's out-of-court statements as evidence exculpating himself. Subject to some exceptions, the rule against hearsay precludes the admission of an out-of-court statement as evidence of the fact asserted in that statement. The trial judge ruled that LM's out-of-court statements were inadmissible in the appellant's trial. The jury found the appellant guilty and LM not guilty. The appellant appealed against his conviction to the Court of Appeal of the Supreme Court of Victoria on grounds including that LM's out-of-court statements were wrongly excluded. The Court of Appeal dismissed the appeal. By special leave, the appellant appealed to the High Court on the basis that LM's out-of-court statements were wrongly excluded. The appellant's principal contention was that a limited exception to the hearsay rule should be allowed for joint trials where a co-accused’s admission is reliable. The appellant argued that LM's admissions were reliable because they were made against LM's penal interest. The appellant's broad contention was that it was appropriate to recognise a new exception to the hearsay rule for third party confessions in order to bring the common law into line with the uniform Evidence Act provisions governing the reception of hearsay evidence when a witness is unavailable. The High Court dismissed the appeal. The Court held that the exclusion of the out-of-court statements was not unfair and did not occasion a miscarriage of justice in the appellant's trial. The appellant had intended to rely on LM's statements as an admission that LM had caused the fall of the deceased. However, the Court found that LM had not made such an admission: he admitted to pushing the deceased, but did not admit sole guilt. Further, LM's assertions which conveyed that the appellant was not involved in the assault on the deceased before his fall were not evidently against LM's penal interest. The admissions were also consistent with the Crown case.

HIGH COURT OF AUSTRALIA 10 September 2014 COMMONWEALTH BANK OF AUSTRALIA v BARKER [2014] HCA 32 Today the High Court unanimously allowed an appeal from a decision of the Full Court of the Federal Court of Australia and held that a term of mutual trust and confidence should not be implied by law in employment contracts. Stephen Barker’s employment with the Commonwealth Bank of Australia (“the Bank”) was terminated by reason of redundancy on 9 April 2009. On 2 March 2009, Mr Barker was told that his position was to be made redundant and that if he was not redeployed within the Bank, which was the Bank’s preference, his employment would be terminated approximately four weeks thereafter. Having been deprived of access to his Bank email account and voicemail, Mr Barker was not informed about an alternative position within the Bank until 26 March 2009. He was not contacted by the recruitment consultant involved in facilitating the recruitment process for that position, nor was the possibility of retraining for that role discussed with him. Mr Barker commenced proceedings against the Bank in the Federal Court of Australia. He alleged that the conduct of the Bank was in breach of an implied term of mutual trust and confidence and resulted in him being denied the opportunity of redeployment. The primary judge held that there was a term of mutual trust and confidence implied in the agreement between Mr Barker and the Bank and that the Bank’s serious breach of its own redeployment policy amounted to a breach of that implied term. The Full Court, by majority, agreed that a term of mutual trust and confidence was implied by law into the agreement, but held that the primary judge erred in treating the term as co-extensive with an obligation to observe the redeployment policy. The majority held that the implied term required that the Bank take positive steps to consult with Mr Barker about alternative positions within the Bank and give him the opportunity to apply for them. By failing to make contact with him for a period which the primary judge had found to be unreasonable, the term had been breached. By grant of special leave, the Bank appealed to the High Court. The question in the appeal was whether employment contracts contain a term of mutual trust and confidence implied by law that the parties will not, without reasonable cause, conduct themselves in a manner likely to destroy or seriously damage the relationship of trust and confidence between them. Allowing the appeal, the Court held that the proposed term was not necessary in the sense that would justify implying it by law into all employment contracts.

HIGH COURT OF AUSTRALIA 16 May 2016 BELL GROUP N.V. (IN LIQUIDATION) v WESTERN AUSTRALIA; W.A. GLENDINNING & ASSOCIATES PTY LTD v WESTERN AUSTRALIA; MARANOA TRANSPORT PTY LTD (IN LIQ) v WESTERN AUSTRALIA [2016] HCA 21 Today the High Court unanimously held that the Bell Group Companies (Finalisation of Matters and Distribution of Proceeds) Act 2015 (WA) ("the Bell Act") is invalid in its entirety by the operation of s 109 of the Constitution because of inconsistency between its provisions and provisions of the Income Tax Assessment Act 1936 (Cth) and the Taxation Administration Act 1953 (Cth) (collectively, "the Tax Acts"). In November 2015, the Parliament of Western Australia enacted the Bell Act "to provide a legislative framework for the dissolution, and administration of the property, of The Bell Group Ltd ACN 008 666 993 (In Liquidation) and certain of its subsidiaries and for related purposes". The Bell Act was enacted to deal with a list of companies, each defined in the Bell Act as a "WA Bell Company" and each either in liquidation or deregistered. The Commonwealth is a substantial creditor of a number of WA Bell Companies in respect of taxation liabilities. The purported legal operation and practical effect of the Bell Act is that the State of Western Australia ("the State") collects, pools, and vests in a State authority, the property of each WA Bell Company. The State then determines in its "absolute discretion" who is paid an amount or has property transferred to or vested in them out of the pooled property (if anyone). To the extent that the State chooses not to distribute the pooled property of the WA Bell Companies, the surplus vests in the State. In each proceeding, the parties stated a special case and questions of law arising for the opinion of the Full Court. The questions of law include whether the Bell Act (or certain provisions of the Bell Act) is invalid by the operation of s 109 of the Constitution because of inconsistency with one or more provisions of the Tax Acts. By majority, the High Court held that the Bell Act purports to create a scheme under which Commonwealth tax debts are stripped of the characteristics ascribed to them by the Tax Acts as to their existence, their quantification, their enforceability and their recovery. The rights and obligations which arose and had accrued to the Commonwealth as a creditor of the WA Bell Companies in liquidation, and to the Commissioner of Taxation, under a law of the Commonwealth prior to the commencement of the Bell Act are altered, impaired or detracted from by the Bell Act. That alteration or impairment of, or detraction from, the Tax Acts engages s 109 of the Constitution which operates to render the offending provisions of the Bell Act invalid. It was not possible to read down offending aspects of the Bell Act nor were the offending provisions able to be severed from the rest of the Bell Act. The Court held, therefore, that the Bell Act is invalid in its entirety. That being so, the Court found it unnecessary to consider other challenges to the validity of the Bell Act.

HIGH COURT OF AUSTRALIA 4 May 2011 ROACH v THE QUEEN [2011] HCA 12 Mr Roach was convicted by a jury of assault occasioning bodily harm, arising out of an alleged incident with the complainant, a woman with whom he had been in an intermittent relationship for two and a half years. Mr Roach had telephoned the complainant asking if he could visit her. Shortly thereafter he arrived at the complainant's house, and immediately went to get a drink from the refrigerator. When the complainant suggested that he ought not to help himself before being invited to do so, Mr Roach allegedly punched her face and arms, then pulled on her left arm, which he had previously injured. He then spoke aggressively to her, before punching her another eight times. At Mr Roach's trial in the District Court of Queensland, the trial judge admitted evidence of other assaults by Mr Roach upon the complainant in the course of their relationship. Section 132B of the Evidence Act 1977 (Qld) ("the Act") applies, inter alia, to proceedings for assault occasioning bodily harm and states that "[r]elevant evidence of the history of the domestic relationship between the defendant and the person against whom the offence was committed is admissible in evidence in the proceeding." In the Court of Appeal Mr Roach argued that, in considering whether to admit such evidence under s 132B, the trial judge ought not to admit that evidence if, in the context of the prosecution case, there was a reasonable view of that evidence consistent with innocence ("the rule in Pfennig"). The rule in Pfennig recognises the prejudicial effect of evidence used to prove a propensity of the accused ("propensity evidence"), and applies at common law to propensity evidence as a measure of the probative force of that evidence. Mr Roach contended alternatively that if the evidence were admitted, the jury ought to have been directed that they could not rely upon it unless satisfied of its truth beyond reasonable doubt. The Court of Appeal rejected both arguments and dismissed the appeal. It held that the sole test for admissibility under s 132B of the Act is relevance, and that the rule in Pfennig had no application. In the High Court, Mr Roach advanced the same arguments. He argued further, and in the alternative, that the rule in Pfennig ought to be considered and applied in connection with s 130 of the Act. Section 130 provides that nothing in the Act "derogates from the power of the court in a criminal proceeding to exclude evidence if the court is satisfied that it would be unfair to the person charged to admit that evidence." Today the High Court dismissed the appeal. It observed that s 132B has a potentially wide operation not restricted to similar fact evidence tendered to prove propensity on the part of the accused, and that the sole test of admissibility for evidence of domestic violence in the history of a relationship is relevance. The Court observed that, while the rule in Pfennig addressed the same factors as are relevant to a court's discretion to exclude evidence on the basis of unfairness, the rule in Pfennig was of the nature of an exclusionary rule of law rather than a discretion. Therefore the rule could not be imported into the power referred to in s 130, which is discretionary in nature. In relation to the adequacy of the directions to the jury, the High Court held that the directions explaining the limited use to which the evidence of the history of the relationship between Mr Roach and the complainant may be put were sufficient, and that it was neither necessary nor appropriate for any direction to be given about the standard of proof to be applied to that evidence. Contrary to the view taken in the Court of Appeal, the High Court observed that there was a dual purpose for which the evidence was tendered: evidence both of the alleged offence and as "relationship" evidence.

HIGH COURT OF AUSTRALIA 14 August 2019 PALMER & ORS v AUSTRALIAN ELECTORAL COMMISSION & ORS [2019] HCA 24 Today the High Court published its reasons for orders made on 7 May 2019 dismissing a challenge to a practice of the Australian Electoral Commission ("the Commission"). The Court unanimously held that the Commission could publish information about an indicative two-candidate preferred count ("the Indicative TCP Count") for a Division of the House of Representatives as soon as polls closed in that Division. Since 1992, s 274(2A)-(2C) of the Commonwealth Electoral Act 1918 (Cth) ("the Electoral Act") has required the scrutiny of votes in an election for each Division to include the Indicative TCP Count. It is a count of preference votes (other than first preference votes) on the ballot papers that, in the opinion of the Australian Electoral Officer, will best provide an indication of the candidate most likely to be elected for the Division. The Commission's established practice is that, from the close of polls in a Division, or shortly thereafter, the Commission's website, "The Tally Room", displays the identity of the candidates in respect of whom the Indicative TCP Count will be undertaken and, in most cases, a "matched polling place projection" based on progressive results of the Indicative TCP Count. The plaintiffs were endorsed and nominated by the United Australia Party as candidates in a Division of the House of Representatives or for the Senate in the federal election held on 18 May 2019. Prior to that election, the plaintiffs filed an application for a constitutional or other writ in the original jurisdiction of the Court seeking to challenge the practice of the first defendant, the Commission, in making public, while polls remained open in some parts of Australia, one or both of the identity of the candidates selected by the Commission for the purpose of the Indicative TCP Count in a Division and the progressive results of any of those indicative counts (collectively, "the TCP Information"). The plaintiffs submitted that publishing the TCP Information after polls closed in the relevant Division but before the polls closed in all parts of the nation is not authorised by the Electoral Act. In particular, they submitted that by publishing that information, the Commission would not be impartial or avoid the appearance of favouring one or more of the candidates. They also submitted that by publishing that information while the polls remained open in any part of the nation, the Commission "would impermissibly distort the voting system in a manner that would compromise the representative nature of a future Parliament", contrary to ss 7 and 24 of the Constitution. The High Court unanimously held that the plaintiffs' contentions about the Indicative TCP Count process, which underpinned both their statutory and constitutional challenges, lacked a factual foundation. The selection of candidates for the Indicative TCP Count was not shown to be inaccurate or misleading, and publication of the TCP Information does not constitute the Commission giving any imprimatur to any particular candidate or outcome. Accordingly, s 7(3) of the Electoral Act, which provides that "[t]he Commission may do all things necessary or convenient to be done for or in connection with the performance of its functions", empowers the Commission to publish the TCP Information as soon as the polls close in the relevant Division.

HIGH COURT OF AUSTRALIA Public Information Officer 5 September, 2003 CHIEF EXECUTIVE OFFICER OF CUSTOMS v LABRADOR LIQUOR WHOLESALE PTY LIMITED, LAWRENCE ERIC WRIGHT AND JEFFREY ANDREW JOHN BRYCE The standard of proof for prosecutions for customs and excise offences was proof beyond reasonable doubt, the High Court of Australia held today, even where those prosecutions are framed as civil actions. This was a higher standard than the alternative, on the balance of probabilities. Labrador Liquor and its two directors allegedly unlawfully failed to pay certain customs and excise duties due on alcohol and cigarettes by falsely claiming that the goods had been exported to the Solomon Islands and Fiji in 1996. The Queensland Supreme Court held that the standard of proof was the civil standard, on the balance of probabilities, and that the customs and excise prosecutions were not criminal proceedings. The Court of Appeal held, by majority, that the criminal standard of proof, beyond reasonable doubt, applied and that the prosecutions were criminal proceedings for the purposes of the Queensland Evidence Act. Customs appealed to the High Court, seeking to have the civil standard of proof apply. The High Court allowed the appeal in part. It unanimously held that to obtain a conviction for any of the particular offences under the Customs Act and the Excise Act, the elements of the offence must be established beyond reasonable doubt. However, the provisions of the Evidence Act which would be applied by the Queensland Supreme Court in civil cases, in particular the admissibility of documentary evidence, are to be applied.

HIGH COURT OF AUSTRALIA 10 August 2005 JURE JACK RONCEVICH v REPATRIATION COMMISSION A soldier who injured his knee when he fell from a window after drinking a large quantity of beer may be entitled to compensation, the High Court of Australia held today. Mr Roncevich was a non-commissioned officer (NCO) in the Australian Army from 1974 to 1998, rising to warrant officer (class 1) at the time of his voluntary discharge. On 27 February 1986, Mr Roncevich, then a sergeant, attended drinks and dinner for a visiting senior officer at the Sergeants’ Mess at Holsworthy Military Barracks in Sydney where he was stationed. NCOs on base were expected to attend such functions for distinguished visitors. Mr Roncevich had drunk six to eight cans of full-strength beer before excusing himself to change into civilian clothes and to iron his uniform for the next day. In his room, on the second floor of the barracks, he opened his window and stood on a trunk beneath the window to lean out to spit. He overbalanced and fell to the ground, causing an internal derangement of his left knee. On his retirement from the Army, Mr Roncevich made a claim under the Veterans’ Entitlements Act seeking compensation for various injuries he suffered during his service, including the knee injury. The Repatriation Commission rejected the claim for the knee, a decision upheld by the Administrative Appeals Tribunal (AAT). The Federal Court of Australia held that the AAT’s decision was affected by error of law and the matter was remitted to the AAT for a fresh hearing. The AAT again rejected Mr Roncevich’s claim, holding that his injury was caused by intoxication and did not occur in the course of his defence service. The Federal Court and the Full Court of the Federal Court, by majority, upheld this decision. Mr Roncevich appealed to the High Court. The Court unanimously allowed the appeal. It held that the AAT, in asking itself whether Mr Roncevich’s intoxication was caused by, or arose out of, a task that he had to do as a soldier, it posed the wrong question. Under section 70(5) of the Act, the question the AAT should have asked was whether the injury arose out of, or was attributable to, any defence service by Mr Roncevich. Evidence in the case showed a requirement and an expectation of attendance at the Mess and the consumption of alcoholic drinks. Mr Roncevich’s need to return to his quarters to prepare his uniform for the next day was also capable of being seen to have arisen out of, or to have been attributable to, his defence service. On the remaining question whether climbing on to the box and falling through the window because he was intoxicated was also related to his defence service, the Court held that it was relevant that there was no suggestion of misconduct or a breach of discipline, and that the inebriation and the accident while performing the duty of preparing a uniform occurred on base. The Court also held that the terms “arising out of” and “attributable” gave “defence- caused” a broad meaning. It held that it was not appropriate for the High Court or the Federal Court to decide the ultimate question whether Mr Roncevich’s injury was defence-caused, and remitted the case to the AAT to be determined according to law.

HIGH COURT OF AUSTRALIA 9 August 2017 IL v THE QUEEN [2017] HCA 27 Today the High Court, by majority, allowed an appeal from a decision of the Court of Criminal Appeal of the Supreme Court of New South Wales. The appellant was tried in the Supreme Court of New South Wales. Count 1 on the indictment charged the appellant with manufacturing a large commercial quantity of a prohibited drug, namely methylamphetamine. Count 2 charged the appellant with murder, or alternatively manslaughter, pursuant to s 18(1) of the Crimes Act 1900 (NSW). At trial, the Crown alleged that the appellant had committed the offence in Count 1 by participating with the deceased in a joint criminal enterprise to manufacture a large commercial quantity of methylamphetamine. The Crown case on Count 2 was that the appellant was guilty of "felony" or "constructive" murder, or alternatively manslaughter, because the act which caused the deceased's death was committed in the course of the joint criminal enterprise to manufacture a large commercial quantity of methylamphetamine, an offence punishable by imprisonment for life. The act causing death was the lighting of a gas ring burner in a small and inadequately ventilated bathroom, which caused a fire. Although the Crown could not exclude the possibility that the deceased had lit the gas ring burner himself and so was killed accidently as a result of his own act, the Crown argued that, because the appellant participated with the deceased in the joint criminal enterprise, the appellant was criminally liable for all acts committed in the course of carrying out that enterprise for the purposes of s 18(1) of the Crimes Act. At the close of the Crown case, the appellant moved for directed verdicts of not guilty in respect of each of the alternative counts in Count 2. The trial judge acceded to that application and directed the jury accordingly. On appeal, the Court of Criminal Appeal held that the trial judge was incorrect to direct a verdict of acquittal on each of the alternative counts. By grant of special leave, the appellant appealed to the High Court. By majority, the Court allowed the appeal. Three Justices allowed the appeal on the basis that s 18(1) of the Crimes Act is not engaged if a person kills himself or herself. Two Justices allowed the appeal on the basis that it is not open to attribute criminal liability to one participant in a joint criminal enterprise for an act committed by another participant in the course of carrying out that enterprise unless the act is, or is part of, the actus reus of a crime. Assuming the deceased lit the gas ring burner, that act was not the actus reus of the crime of murder or manslaughter. The appeal was therefore allowed, and the verdicts of acquittal on Count 2 reinstated.

HIGH COURT OF AUSTRALIA 11 September 2012 RAYMOND HOWARD LYLE DOUGLASS v THE QUEEN [2012] HCA 34 On 16 August 2012, the High Court allowed an appeal by the appellant against his conviction for the aggravated indecent assault of his granddaughter, CD, and directed that his conviction be quashed and a verdict of acquittal be entered. Today the High Court published its reasons for allowing the appeal. The appellant was alleged to have persuaded CD to hold his penis on an occasion when the two were alone in a shed. CD was aged three years at the time of the alleged offence. The appellant was tried by a judge without a jury in the District Court of South Australia. The only evidence of the offence came from CD in unsworn statements made by her in an interview with a psychologist which took place a few weeks after CD's fourth birthday. The limited detail of CD's allegation in the interview was given in response to leading questions and only after she had failed to recall the incident on three occasions. Subsequently, CD had given inconsistent accounts of the scene of the alleged offence. It was also at least possible that CD could not recall the day of the alleged offence by the time she gave evidence 22 months later. The appellant gave sworn evidence denying the allegation against him. He was convicted and sentenced to three years' imprisonment with a non- parole period of 18 months. The appellant appealed to the Court of Criminal Appeal of the Supreme Court of South Australia on two grounds. The first ground of appeal was that the trial judge had failed to give sufficient reasons for the verdict. The appellant complained that the judge had arrived at a conclusion of guilt without rejecting his sworn denial of the offence. The second ground of appeal was that CD's evidence was insufficient to establish proof of the offence beyond reasonable doubt. The appeal was dismissed. In the High Court, the appellant was successful on both grounds. On the first ground, the Court found that the trial judge's failure to record any finding respecting the appellant's evidence left as one possibility that the judge simply preferred CD's evidence and convicted upon it applying less than the standard of proof beyond reasonable doubt. The absence of reasons sufficient to exclude that possibility constituted legal error. On the second ground, the High Court observed that the trial judge's finding was of satisfaction beyond reasonable doubt of the truthfulness of CD's evidence and that he had not addressed the distinct question of the reliability of CD's evidence to establish the commission of the offence beyond reasonable doubt. The problems with CD's evidence meant that it was not sufficient to support a conclusion beyond reasonable doubt that the offence that the appellant was charged with had occurred. Success on the second ground required that the appellant's conviction be quashed and a verdict of acquittal be entered.

HIGH COURT OF AUSTRALIA 21 March 2018 [2018] HCA 11 the High Court unanimously held (Parliamentary Today Disqualifications) Act 1975 (Cth) ("the Common Informers Act") does not confer jurisdiction upon the Court to decide whether a person is a person declared by the Constitution to be incapable of sitting as a senator or as a member of the House of Representatives. the Common Informers that On 20 July 2016 Dr David Gillespie was declared elected as a member of the House of Representatives. On 7 July 2017, Mr Peter Alley commenced proceedings against Dr Gillespie under the Common Informers Act claiming the imposition of penalties on the basis that Dr Gillespie was incapable of being chosen and of sitting as a member of the House of Representatives pursuant to s 44(v) of the Constitution. Section 44(v) relevantly provides that "[a]ny person who ... has any direct or indirect pecuniary interest in any agreement with the Public Service of the Commonwealth ... shall be incapable of being chosen or of sitting as a senator or a member of the House of Representatives." Mr Alley alleges that Dr Gillespie had a direct or indirect pecuniary interest in a lease agreement between a company in which Dr Gillespie holds shares and Australia Post. Whether Dr Gillespie is liable to a penalty under the Common Informers Act requires an anterior determination as to whether he has been or is incapable of sitting as a member of the House of Representatives. On 29 September 2017, Bell J referred the question of whether the High Court has jurisdiction to decide Dr Gillespie's eligibility to the Full Court. Section 46 of the Constitution provides that "[u]ntil the Parliament otherwise provides, any person declared by this Constitution to be incapable of sitting as a senator or as a member of the House of Representatives shall, for every day on which he so sits, be liable to pay the sum of one hundred pounds to any person who sues for it in any court of competent jurisdiction." The Parliament otherwise provided by enacting the Common Informers Act, which limits the amount a person might have to pay by way of penalty. Section 47 of the Constitution relevantly provides that "[u]ntil the Parliament otherwise provides, any question respecting the qualification of a senator or of a member of the House of Representatives ... shall be determined by the House in which the question arises." The Parliament has also otherwise provided with respect to s 47. Section 376 of the Commonwealth Electoral Act 1918 (Cth) ("the Electoral Act") provides that either House may refer any question concerning the qualification of a senator or member of the House of Representatives to the Court of Disputed Returns. The High Court unanimously held that while s 46 of the Constitution allows for the imposition and recovery of a penalty in a common informer action, the anterior question of liability is to be determined by the means provided by s 47. The Court ordered that the proceeding under the Common Informers Act be stayed until the question of whether Dr Gillespie is incapable of sitting as a member of the House of Representatives is determined pursuant to s 47 of the Constitution or s 376 of the Electoral Act.

HIGH COURT OF AUSTRALIA 18 June 2014 PLANTIFF S156/2013 v MINISTER FOR IMMIGRATION AND BORDER PROTECTION & ANOR [2014] HCA 22 Today the High Court unanimously upheld the validity of two provisions in subdiv B of Div 8 of Pt 2 of the Migration Act 1958 (Cth) ("the Act"), as well as two decisions made under those provisions by the Minister for Immigration and Border Protection ("the Minister"). The plaintiff, a citizen of the Islamic Republic of Iran, entered Australia's migration zone by sea at Christmas Island on 23 July 2013. His method of entry into Australia qualified him as an "unauthorised maritime arrival" ("UMA") under s 5AA of the Act. After arriving at Christmas Island, the plaintiff was detained by an officer of the Department of Immigration and Border Protection and subsequently removed to an assessment centre on Manus Island in the Independent State of Papua New Guinea ("PNG"). The plaintiff commenced proceedings in the original jurisdiction of the High Court, challenging the validity of ss 198AB and 198AD of the Act on the ground that neither provision is supported by any head of power in s 51 of the Constitution. Section 198AB provides that the Minister may designate that a country is a regional processing country. Section 198AD provides that UMAs must be taken from Australia to a regional processing country. Where there are two or more regional processing countries, s 198AD(5) provides that the Minister must give a written direction to take a UMA, or a class of UMAs, to the regional processing country specified in the direction. The plaintiff also challenged the validity of the Minister's decision of 9 October 2012 to designate PNG as a regional processing country under s 198AB ("the designation decision") and the Minister's decision of 29 July 2013 to give a written direction under s 198AD(5) to take UMAs to PNG or to the Republic of Nauru ("the direction decision"). On 13 February 2014, a case was stated and questions reserved for the consideration of the Full Court. The High Court unanimously held that ss 198AB and 198AD are valid under the aliens power conferred by s 51(xix) of the Constitution. The provisions operate to effect the removal of UMAs from Australia and are therefore laws with respect to a class of aliens. The Court also upheld the validity of the designation decision and the direction decision. It held that there is nothing in the text or scope of subdiv B to support the plaintiff's argument that there were relevant considerations which the Minister was obliged to, but did not, take into account in making the designation decision. The Court dismissed the plaintiff's other grounds for challenging the decisions and held that the proceedings are otherwise able to be remitted to the Federal Circuit Court of Australia.

HIGH COURT OF AUSTRALIA 23 June 2005 DIANE McGRATH FINGLETON v THE QUEEN The High Court of Australia today unanimously allowed an appeal by Ms Fingleton, the former Chief Magistrate of Queensland, and quashed her conviction for unlawful retaliation against a witness, holding that the conduct that led to the charge was protected by the immunity against criminal prosecution conferred by the Magistrates Act. Section 30 of Queensland’s Criminal Code provides: “Except as expressly provided by this Code, a judicial officer is not criminally responsible for anything done or omitted to be done by the judicial officer in the exercise of the officer’s judicial functions, although the act done is in excess of the officer’s judicial authority, or although the officer is bound to do the act omitted to be done.” Section 21A of the Magistrates Act provides: “A magistrate has, in the performance or exercise of an administrative function or power conferred on the magistrate under an Act, the same protection and immunity as a magistrate has in a judicial proceeding in a Magistrates Court.” The Chief Magistrate’s responsibilities included assigning magistrates to locations throughout Queensland. Postings had been a source of tension between Chief Magistrates and the Magistrates Association. The Magistrates Act established a judicial committee to review grievances about a Chief Magistrate’s determinations. In July 2002, Ms Fingleton decided to transfer Anne Thacker from Brisbane to Townsville. Ms Thacker applied for a review by the committee and wrote to the Magistrates Association seeking information about other transfers. Association vice-president and the coordinating magistrate for Beenleigh, Basil Gribbin, provided an affidavit in support of Ms Thacker in the review proceedings. Ms Fingleton provided an affidavit in reply. Friction between her and Mr Gribbin arose regarding an item he was circulating for the agenda for a meeting of coordinating magistrates without discussing it with Ms Fingleton. The day before the meeting, she emailed Mr Gribbin a letter asking him to show cause why she should not exercise her power to remove him from the position of coordinating magistrate. She obtained legal advice before sending the letter. She objected to him providing an affidavit for Ms Thacker as he had never discussed transfers with her and she accused him of disloyalty for circulating the proposed agenda item. Ms Fingleton was charged with causing or threatening harm without reasonable cause in retaliation for something lawfully done in a judicial proceeding, an offence under section 119B of the Criminal Code. She denied sending the letter as payback for Mr Gribbin’s support of Ms Thacker and said she sent it as his conduct showed she did not have his confidence and loyalty. Ms Fingleton was convicted in a second trial in the Queensland Supreme Court after the first trial resulted in a jury disagreement. Because she was found guilty of this charge, the jury was not required to return a verdict upon an alternative charge of attempting to pervert the course of justice. The Court of Appeal dismissed an appeal against conviction but it suspended her sentence of 12 months’ imprisonment for two years after she served six months in jail. The sole ground of appeal to the Court of Appeal was that no reasonable jury could have found beyond reasonable doubt an absence of reasonable cause in Ms Fingleton’s conduct. Neither section 21A of the Act nor section 30 of the Code were raised either at her trial or in the Court of Appeal. Those provisions were first raised by the High Court when considering Ms Fingleton’s application for special leave to appeal, and were the basis of the primary ground of appeal. If she had available a point of law which was a complete answer to the charges against her, the point could be raised for the first time in the High Court. The Court held that Ms Fingleton should not have been held criminally responsible for her conduct. She was entitled under the Act and the Code to an immunity that was wrongly denied to her. Ms Fingleton’s conduct in calling upon Mr Gribbin to show cause why he should not be removed was conduct in the exercise of an administrative power conferred on her by section 10(2) of the Act.

HIGH COURT OF AUSTRALIA 11 November 2015 NORTH AUSTRALIAN ABORIGINAL JUSTICE AGENCY LIMITED & ANOR v NORTHERN TERRITORY OF AUSTRALIA [2015] HCA 41 Today the High Court, by majority, dismissed an application for a declaration that Div 4AA of Pt VII of the Police Administration Act (NT) ("the Act") is invalid. Section 133AB(1) of the Act, which appears in Div 4AA, provides that the section applies if a member of the Police Force has arrested a person without a warrant in accordance with s 123 because the member believed on reasonable grounds that the person had committed, was committing or was about to commit an infringement notice offence. Section 133AB(2) provides that the member may take the person into custody and hold him or her for a period of up to four hours or, if the person is intoxicated, until the member reasonably believes that the person is no longer intoxicated. Section 133AB(3) provides that at the expiry of the relevant period in sub-s (2), the member may release the person unconditionally, with an infringement notice or on bail, or may bring the person before a justice of the peace or court. The first plaintiff provides legal services to Aboriginal and Torres Strait Islander persons in the Northern Territory. The second plaintiff, an Aboriginal person resident in the Northern Territory, was arrested by members of the Northern Territory Police Force in Katherine on 19 March 2015 and was detained pursuant to Div 4AA for a period of close to 12 hours. The first plaintiff commenced proceedings in the original jurisdiction of the High Court, joined by the second plaintiff. The plaintiffs sought a declaration that Div 4AA is invalid. The plaintiffs contended that Div 4AA is invalid because it confers powers on the Northern Territory Executive which are penal or punitive in character, and that this is beyond the legislative power of the Northern Territory because that power is subject to the same doctrine of the separation of judicial power which limits the legislative power of the Commonwealth. The plaintiffs also contended that Div 4AA is invalid because it confers powers on the Northern Territory Executive which undermine or interfere with the institutional integrity of the Northern Territory courts. The parties agreed a special case which asked the Court to determine whether Div 4AA of Pt VII is invalid. The High Court, by majority, held that Div 4AA is valid. A majority of the Court held that, upon the proper construction of Div 4AA, the powers it confers on members of the Police Force are not penal or punitive in character and do not impair, undermine or detract from the institutional integrity of the Northern Territory courts. Div 4AA, properly construed, does not authorise members of the Police Force to detain a person for longer than is reasonably practicable for them to make a determination about which one of the options under s 133AB(3) is to be exercised. The Court ordered that the matter be referred to a single Justice for further directions. This statement is not intended to be a substitute for the reasons of the High Court or to be used in any later consideration of the Court’s reasons.

HIGH COURT OF AUSTRALIA 15 November 2012 STANFORD v STANFORD [2012] HCA 52 Today the High Court unanimously allowed an appeal from two decisions of the Full Court of the Family Court of Australia concerning the settlement of property owned by a husband and wife. The High Court held that there was no basis to conclude that it was just and equitable to make an order altering interests in the marital property between them. The husband and wife married in 1971. In December 2008, the wife suffered a stroke and moved into full time residential care. She was later diagnosed with dementia. The husband continued to provide for her care and set aside money in a bank account to meet the costs of her medical needs or requirements. He continued to live in the matrimonial home. In 2009, the wife (by one of her daughters as case guardian) applied to the Family Court for orders altering interests in the marital property between the wife and her husband. Under the Family Law Act 1975 (Cth), a court can make a property settlement order if it is "just and equitable" to do so. At first instance, a magistrate ordered that the husband pay his wife $612,931, which represented the amount assessed as her contribution to the matrimonial assets. The husband appealed to the Full Court of the Family Court. After the appeal had been heard but before judgment was delivered, the wife died and her daughters continued the proceedings as her legal personal representatives. Under the Family Law Act, if a party dies before the conclusion of proceedings, a court may make a property settlement order if it would have made an order had the party been alive and if it is still appropriate despite the party's death to make an order. In its first judgment, the Full Court allowed the husband's appeal, holding that the magistrate erred in considering whether it was just and equitable to make a property settlement order. In a second judgment, the Full Court ordered that $612,931 be paid to the wife's legal personal representatives upon the husband's death to reflect her contributions to the marriage and the husband's moral obligations to her. By special leave, the husband appealed to the High Court. The High Court unanimously allowed the appeal. The Court held that there was no basis to conclude that it would have been just and equitable to make a property settlement order had the wife been alive. She had not expressed a wish to divide the property, a property settlement order would require the husband to sell the matrimonial home, in which he still lived, and the Full Court had found, on the material before the magistrate, that her needs were being met or could be met by a maintenance order. The bare fact of physical separation, when involuntary, does not without more show that it is just and equitable to make a property settlement order.

HIGH COURT OF AUSTRALIA 11 March 2015 FORTRESS CREDIT CORPORATION (AUSTRALIA) II PTY LIMITED & ANOR v WILLIAM JOHN FLETCHER AND KATHERINE BARNET AS LIQUIDATORS OF OCTAVIAR LIMITED (RECEIVER AND MANAGERS APPOINTED) (IN LIQUIDATION) AND OCTAVIAR ADMINISTRATION PTY LIMITED & ORS [2015] HCA 10 Today, the High Court unanimously dismissed an appeal from a decision of the Court of Appeal of the Supreme Court of New South Wales and held that a court can make an order under s 588FF(3) of the Corporations Act 2001 (Cth) ("the Act") to extend the time within which a company's liquidator may apply for orders in relation to voidable transactions entered into by the company, in circumstances where those transactions cannot be identified at the time of the order. Such orders are known as "shelf orders". Section 588FF(1) of the Act empowers a court, on the application of a company's liquidator, to make a number of orders in relation to voidable transactions. Section 588FF(3), as it stood at the date of the order giving rise to this appeal, provided that an application for orders under s 588FF(1) had to be made: (a) during a specified period ("the paragraph (a) period"); or (b) "within such longer period as the Court orders on an application under this paragraph made by the liquidator during the paragraph (a) period". The first respondents are the liquidators of the second and third respondents, Octaviar Limited and Octaviar Administration Pty Limited. The paragraph (a) period in relation to the third respondent expired on 3 October 2011. Before that date, the first respondents applied for an order under s 588FF(3)(b) extending the time for making an application under s 588FF(1) in relation to the third respondent to 3 April 2012. On 19 September 2011, the order sought was granted, expressed without reference to an identified transaction. On 3 April 2012, the first respondents commenced proceedings against the appellants for orders under s 588FF(1). The primary judge in the Supreme Court of New South Wales dismissed an application by the appellants to set aside the extension of time order, and the Court of Appeal dismissed the appellants' appeal. Both the primary judge and the Court of Appeal followed the earlier decision of the Court of Appeal in BP Australia v Brown (2003) 58 NSWLR 322. By grant of special leave, the appellants appealed to the High Court, submitting that the extension of time order was required to specify the particular transactions in respect of which the order was made. The High Court unanimously dismissed the appeal, holding that a court can make an order extending time under s 588F(3)(b) without identifying the particular transaction or transactions to which it would apply. That construction is consistent with the evident purpose of s 588F(3)(b), to allow the court to mitigate the strictness of the time limits imposed by s 588FF(3)(a) in an appropriate case. The re- enactment of s 588FF(3), which took place after the holding in BP Australia v Brown that a court could make an order granting an extension of time in general terms, may be taken to support that construction.

HIGH COURT OF AUSTRALIA 11 October 2017 THE DIRECTOR OF PUBLIC PROSECUTIONS v CHARLIE DALGLIESH (A PSEUDONYM) [2017] HCA 41 Today the High Court unanimously allowed an appeal from the Court of Appeal of the Supreme Court of Victoria. The High Court held that the Court of Appeal erred in concluding that, although the range of sentences indicated by current sentencing practices for the offence of incest was so low as to reveal error in principle, the sentence the subject of appeal before that Court was within that range and so ought not be disturbed. Mr Dalgliesh was convicted on his plea of guilty of one act of incest (charge 1) and one act of sexual penetration of a child under 16 (charge 4) upon complainant A, and one act of incest (charge 2) and one act of indecent assault (charge 3) upon complainant B. At the time of the offending, A was aged between nine and 13 years and B was aged between 15 and 16 years. A and B are sisters, and their mother was, at the time of the offending the subject of charges 1 to 3, Mr Dalgliesh's de facto spouse. As a result of Mr Dalgliesh's act of incest upon A, she fell pregnant, and the pregnancy was later terminated. In respect of charge 1, the sentencing judge sentenced Mr Dalgliesh to three years and six months' imprisonment. The Director of Public Prosecutions appealed, relevantly, on the ground that the sentence imposed on charge 1 was manifestly inadequate. Prior to the hearing, the Deputy Registrar of the Court of Appeal, at the request of that Court, wrote to the parties seeking submissions on the adequacy of "current sentencing practices" for the offence of incest, which is a matter to which sentencing courts in Victoria must have regard by virtue of s 5(2)(b) of the Sentencing Act 1991 (Vic). The Deputy Registrar advised the parties that the Court's "decision on the general question [would] not, of course, affect the outcome of the appeal". In Part A of its reasons, the Court of Appeal assessed the adequacy of Mr Dalgliesh's sentence by reference to current sentencing practices for the offence of incest, and concluded that the sentence, "though extremely lenient, was not wholly outside the permissible range". In Part B, the Court reviewed the sentencing information provided to it and concluded that "current sentencing does not reflect the objective gravity of such offending or the moral culpability of the offender". By grant of special leave, the Director appealed to the High Court, arguing that the Court of Appeal erred in elevating the significance of current sentencing practices so that they were determinative of the adequacy of the sentence imposed on charge 1. The High Court held that, having reached the conclusion that current sentences were so manifestly disproportionate to the gravity of the offending and the moral culpability of the offender as to bespeak an error of principle, the Court of Appeal should have corrected the effect of the error of principle which it recognised. It was held that s 5(2) contemplates that current sentencing practices must be taken into account, but only as one factor, and not the controlling factor, in the fixing of a just sentence. Therefore the High Court allowed the appeal.

HIGH COURT OF AUSTRALIA 14 November 2012 NIGEL CUNNINGHAM SWIFT MANSFIELD v THE QUEEN & ANOR JOHN KIZON v THE QUEEN & ANOR [2012] HCA 49 Today the High Court unanimously held that a person can contravene the prohibitions on insider trading by trading in securities while in possession of "inside information" as described in the Corporations Act 2001 (Cth) even if that information proves to be false. It was alleged that the managing director of AdultShop.com Limited, a listed public company, told each of the appellants, Mr Nigel Mansfield and Mr John Kizon, information about AdultShop's prospects and that Mr Mansfield and Mr Kizon shared that information with each other. It was alleged that, armed with this "inside information", Mr Mansfield and Mr Kizon bought or procured the purchase of shares in AdultShop. The appellants were charged with committing or conspiring to commit numerous offences against the insider trading provisions of the Corporations Act. In the District Court of Western Australia, the prosecution conceded that a jury could not be satisfied beyond reasonable doubt that the information about AdultShop's prospects allegedly in the possession of Mr Mansfield and Mr Kizon was true. The trial judge held that a person could generally only commit insider trading if he or she possessed information that was factually correct and therefore entered judgments of acquittal on the AdultShop counts. A majority of the Court of Appeal of the Supreme Court of Western Australia disagreed, allowed the prosecution's appeal and ordered that there be a new trial. By special leave, Mr Mansfield and Mr Kizon appealed to the High Court. They submitted that a person cannot be guilty of insider trading by buying or procuring the purchase of shares while in possession of information that is objectively false. The High Court unanimously dismissed the appeal. The Court held that a person can contravene the insider trading provisions of the Corporations Act even if the information he or she possesses is false, as long as the statutory criteria for insider trading are met.

HIGH COURT OF AUSTRALIA 21 March 2018 CLONE PTY LTD V PLAYERS PTY LTD (IN LIQUIDATION) (RECEIVERS & MANAGERS APPOINTED) & ORS [2018] HCA 12 Today the High Court unanimously allowed two appeals from the Full Court of the Supreme Court of South Australia. The Court held that the equitable power of the Supreme Court to set aside its own perfected judgment required actual fraud by the party who succeeded at trial and did not extend to misconduct not amounting to fraud. The Court also held that it was not a precondition to the exercise of the power that the party seeking to set aside the judgment exercised reasonable diligence to discover the fraud. In 1994, the first respondent ("Players") negotiated an agreement to lease premises from the appellant ("Clone"). The premises would become the Planet Hotel, a licensed hotel and gaming premises. Clause 11(i) of the agreement to lease provided that "[t]he Lessee will upon expiration or early determination of the Lease transfer to the Lessor any Liquor Licences or gaming machine Licences held in respect of the premises for NIL consideration". In 1995, Players took possession of the premises and the parties executed a memorandum of lease which contained clauses consistent with In 2004 Clone commenced a proceeding against Players in the Supreme Court. Players alleged, among other things, that it struck through the word "NIL" when three of its directors executed the agreement to lease, with the result that consideration was payable to it by Clone under the agreement to lease. It sought rectification of the memorandum of lease. The original agreement to lease was not in evidence at the trial but Clone and Players each discovered and tendered a copy. Each copy showed the word "NIL" with a faint line through the letters "NI" and over the top of the word "for". Clone argued that the line had been made accidentally or mechanically. Clone called evidence that it could not locate any other copies and its senior counsel made calls for Players to produce copies of the agreement. During the trial, Clone's instructing solicitor asked an employee of the Liquor and Gambling Commissioner to search the Commissioner's files for any copies of the agreement to lease. The employee advised that she had located a copy ("the third copy") on a different file to the "Planet Hotel premises file". Upon inspection of that copy, Clone's junior counsel noticed a line through the word "NIL". He did not photocopy it, to avoid it becoming discoverable, and asked the Commissioner's employee to inform him of any inspection by Players' solicitors. The Commissioner's employee complied with that request when Players' solicitors subsequently inspected the Commissioner's files but only requested, and were shown, the Planet Hotel premises file. Clone's principal solicitor then gave a notice to the Commissioner to produce all "Planet files" in the Commissioner's possession, which the solicitor advised required production of the Planet Hotel premises file only. Nonetheless, another file was also produced to the Court, which included a fourth copy of the agreement to lease. Clone was successful at trial on almost all issues. Relevantly, the trial judge held that Clone was not obliged to pay reasonable consideration for the licences, in part on the basis of her Honour's conclusion that the word "NIL" had not been struck through in the agreement to lease. Players appealed to the Full Court, which upheld this conclusion. After the proceedings concluded, Players learned that Clone knew about the third copy and that the fourth copy had been contained in a file produced to the Court, but was not called upon by Clone. In 2010, Players brought two applications to set aside the judgment against it and obtain an order for a new trial: one application in the original proceeding, and one fresh application. Players alleged that the judgment could be set aside on the basis of Clone's malpractice, which malpractice it alleged on three grounds. Both the primary judge and a majority of the Full Court held that Clone had engaged in malpractice and that its misconduct was a sufficient basis to enliven the Court's discretionary power to set aside the judgment. A new trial was ordered. By grant of special leave, Clone appealed to the High Court on two grounds: (i) that the Supreme Court's equitable power to set aside perfected orders is limited to fraud and does not extend to malpractice; and (ii) that the Supreme Court's power to set aside its perfected judgment on the ground of malpractice was conditional upon proof that, absent the malpractice, the judgment would probably have been different, and the party applying to set aside the judgment exercised reasonable diligence. The Court allowed the appeal on the first ground. The Court held that the equitable power in this case was limited to actual fraud, although there are other discrete grounds to set aside a perfected judgment which were not in issue. Fraud must be clearly pleaded and proved, which had not occurred in these proceedings. The Court also stated that the proper application by Clone was a fresh action to rescind the perfected orders, rather than an application in the original proceeding. In the result, the appeal was allowed with costs.

HIGH COURT OF AUSTRALIA 14 November 2018 SAS TRUSTEE CORPORATION v PETER MILES [2018] HCA 55 Today the High Court of Australia unanimously allowed an appeal from a judgment of the Court of Appeal of the Supreme Court of New South Wales regarding the interpretation of s 10(1A)(b)(ii) of the Police Regulation (Superannuation) Act 1906 (NSW) ("the Act"). The Act established a Police Superannuation Fund controlled by SAS Trustee Corporation ("STC"). In 2003, Mr Miles was certified by STC as being incapable of discharging the duties of his office as a police officer, as a result of four specified infirmities of an orthopaedic nature. The Commissioner of Police determined that these infirmities were caused by Mr Miles being hurt on duty. Mr Miles satisfied the criteria of a "disabled member of the police force" in s 10(1) of the Act and, in accordance with s 10(1A)(a), he received an annual superannuation allowance equal to 72.75 per cent of his attributed salary of office, which in 2004 was increased to 82.55 per cent. Section 10(1A)(b)(ii) of the Act provided that the annual superannuation allowance for a disabled member of the police force may increase by an additional amount that is commensurate with the member's "incapacity for work outside the police force". In 2013, Mr Miles applied to STC under that provision for an additional amount of annual superannuation allowance arising from an infirmity of post-traumatic stress disorder ("PTSD") which increased his incapacity for work outside the police force. STC rejected that application. Mr Miles applied to the District Court of New South Wales as a person aggrieved by STC's decision. The primary judge held that, notwithstanding that the PTSD had increased Mr Miles' incapacity for work outside the police force, the PTSD could not be taken into account, as it was a supervening incapacity and not one arising from the four specified infirmities certified by STC. Mr Miles appealed to the Court of Appeal, contending that once a person had met the definition of a disabled member of the police force, as he had, the incapacity for work outside the police force in s 10(1A)(b)(ii) may be an incapacity that arises at any time and from any source, and could in this case arise from the PTSD. STC contended that the incapacity for work outside the police force must arise from a specified infirmity the subject of STC's certification and determined by the Commissioner of Police to have been caused by the member being hurt on duty, and must in this case arise from the specified infirmities of an orthopaedic nature. A majority of the Court of Appeal allowed Mr Miles' appeal holding that there was no reason to restrict s 10(1A)(b)(ii) to an incapacity for work outside the police force caused by the member having been hurt on duty. By grant of special leave, STC appealed to the High Court. The Court held that the context and purpose of s 10(1A)(b)(ii) favoured the conclusion that a disabled member of the police force was not entitled to an additional amount of annual superannuation allowance under s 10(1A)(b)(ii) unless the member's incapacity for work outside the police force was attributable to a specified infirmity determined to have been caused by the member being hurt on duty.

HIGH COURT OF AUSTRALIA 13 October 2021 [2021] HCA 32 Today, the High Court unanimously dismissed an appeal from a judgment of the Full Court of the Federal Court of Australia. The appeal concerned the scope of the intellectual freedom protected by a clause of an enterprise agreement of a university. Dr Ridd was employed by James Cook University for 27 years. From 2016, the University took various disciplinary actions against Dr Ridd for conduct that it concluded breached the University Code of Conduct and constituted misconduct and serious misconduct under the University's Enterprise Agreement. Dr Ridd was issued with two censures ("the 2016 Censure" and "the Final Censure") and, on 2 May 2018, his employment was terminated for serious misconduct under the Enterprise Agreement. Dr Ridd brought proceedings against the University alleging that its actions and the termination of his employment contravened the Enterprise Agreement and s 50 of the Fair Work Act 2009 (Cth) ("the Act"). Dr Ridd did not dispute that the conduct occurred and that it would be misconduct or serious misconduct. He submitted that all of his conduct was an exercise of the intellectual freedom protected by cl 14 of the Enterprise Agreement and could not be a serious breach of the Code of Conduct. The primary judge: concluded that 13 actions taken by the University were contrary to cl 14 of the Enterprise Agreement; made a declaration of 13 contraventions of s 50 of the Act; and ordered the payment of compensation and pecuniary penalties. A majority of the Full Court allowed an appeal and concluded that none of the actions of the University were contrary to the Enterprise Agreement. The High Court unanimously dismissed the appeal. The Court held that the intellectual freedom protected by cl 14 of the Enterprise Agreement was not a general freedom of speech. The exercise of intellectual freedom was subject to constraints contained in cl 14, including some adopted from the Code of Conduct. These constraints upon exercise included respect for the legal rights of others, and required that an expression of disagreement with University decision-making be in accordance with applicable processes, including confidentiality obligations. The exercise of intellectual freedom was not constrained by other Code of Conduct undertakings, such as respect or courtesy. The 2016 Censure and part of the basis of the Final Censure were unjustified because they related to the expression of honestly held views by Dr Ridd within his academic expertise. The Final Censure was justified only insofar as it relied upon expressions of opinion unrelated to Dr Ridd's academic expertise, and findings that he repeatedly failed to comply with his confidentiality obligations. Since Dr Ridd ran his case on an all-or-nothing basis, the termination decision was justified in its reliance upon conduct of Dr Ridd which was the subject of 18 findings of serious misconduct which were not protected by cl 14.

HIGH COURT OF AUSTRALIA 7 October 2015 D'ARCY v MYRIAD GENETICS INC & ANOR [2015] HCA 35 Today the High Court unanimously allowed an appeal from a decision of the Full Court of the Federal Court of Australia. The High Court held that an isolated nucleic acid, coding for a BRCA1 protein, with specific variations from the norm that are indicative of susceptibility to breast cancer and ovarian cancer, was not a "patentable invention" within the meaning of s 18(1)(a) of the Patents Act 1990 (Cth) ("the Act"). The term "nucleic acid" includes two kinds of molecules, deoxyribonucleic acid (DNA) and ribonucleic acid (RNA), which are found inside a human cell. A gene is a functional unit of DNA which encodes a particular protein produced by the cell. The protein produced depends on the sequence of nucleotides. The BRCA1 gene codes for the production of a protein called BRCA1. The first respondent filed a patent which contained 30 claims. Relevantly, Claims 1 to 3 concerned a nucleic acid coding for a BRCA1 protein, and with one or more specified variations from the norm in its nucleotide sequence, isolated from its cellular environment. Those specified variations, characterised as mutations or polymorphisms, are indicative of susceptibility to breast cancer and ovarian cancer. Section 18(1)(a) of the Act requires that, for an invention to be patentable, it must be "a manner of manufacture" within the meaning of s 6 of the Statute of Monopolies. The appellant commenced proceedings in the Federal Court of Australia challenging the validity of Claims 1 to 3 on the basis that the invention claimed did not meet the requirement of s 18(1)(a). The primary judge dismissed the appellant's challenge, holding that the invention fell within the concept of a "manner of manufacture". The Full Court dismissed an appeal from that decision. The Full Court held that an isolated nucleic acid was chemically, structurally and functionally different from a nucleic acid inside a human cell. The invention was a manner of manufacture because an isolated nucleic acid with the characteristics specified in Claims 1 to 3 resulted in an artificially created state of affairs for economic benefit. By grant of special leave, the appellant appealed to the High Court. The Court unanimously allowed the appeal, holding that the invention claimed did not fall within the concept of a manner of manufacture. The Court held that, having regard to the relevant factors, an isolated nucleic acid, coding for the BRCA1 protein, with specified variations, is not a manner of manufacture. While the invention claimed might be, in a formal sense, a product of human action, it was the existence of the information stored in the relevant sequences that was an essential element of the invention as claimed. A plurality of the Court considered that to attribute patentability to the invention as claimed would involve an extension of the concept of a manner of manufacture which was not appropriate for judicial determination.

HIGH COURT OF AUSTRALIA 30 March 2004 The Western Australian Court of Criminal Appeal made errors in reviewing the prison sentence of a convicted drug courier, the High Court of Australia held today. Mr Johnson’s co-accused, Jurgen Helmut Schwarz, was apprehended as he arrived in Perth in November 2000 carrying 5,533 ecstasy tablets and almost 1.5kg of cocaine. He agreed to participate in a controlled delivery of material substituted for the confiscated drugs. Mr Schwarz checked into a hotel in the suburb of Como and by arrangement Mr Johnson arrived to collect the supposed drugs. The Australian Federal Police arrested him as he left the hotel room and arrested Phillip David Smart who was waiting with $10,688 in Mr Johnson’s sister’s car outside the hotel. Mr Johnson was charged with attempting to obtain a commercial quantity of ecstasy (more than 500 grams) and attempting to obtain a trafficable quantity of cocaine (between two grams and 2kg). Mr Johnson pleaded guilty in the WA Supreme Court. Justice Graeme Scott said the appropriate sentence for the first count was 10 years’ jail and for the second count five years’ jail, to be served cumulatively. The sentence for the second count was reduced on account of the totality principle. The total sentence of 15 years was reduced by a further 3½ years for Mr Johnson’s guilty plea to 11½ years, with a 5½-year non-parole period. Mr Johnson’s appeal against his sentence was rejected by the CCA. He contended that he collected only one package with no knowledge of the particular drugs he was collecting, and that insufficient allowance was made for the fact that the offences arose from a single course of conduct. The High Court held that the two offences had much in common, including one inducement, one payment, one occasion, one package and one receipt of it, and that the CCA had made factual errors in its reasoning. The High Court unanimously allowed the appeal and remitted the matter to the CCA for reconsideration of Mr Johnson’s sentence in accordance with the Court’s reasons.

HIGH COURT OF AUSTRALIA 29 February 2012 ROSLYN EDWINA WALLER v HARGRAVES SECURED INVESTMENTS LIMITED [2012] HCA 4 Today the High Court allowed an appeal from the Court of Appeal of the Supreme Court of New South Wales, which had upheld an enforcement action under a farm mortgage by Hargraves Secured Investments Limited ("HSI") against Roslyn Edwina Waller. The High Court held that the Farm Debt Mediation Act 1994 (NSW) ("the Act") barred HSI from obtaining a money judgment against Ms Waller or possession of Ms Waller's farm. Section 8(1) of the Act conditions a creditor's ability to take "enforcement action" in respect of a "farm mortgage" upon 21 days' prior written notice to the debtor farmer, in response to which the farmer may request mediation under s 9 of the Act. Enforcement action taken by a creditor to whom the Act applies, otherwise than in accordance with the Act, is void. Section 11 provides for the issue by the New South Wales Rural Assistance Authority ("the Authority") of a certificate that the Act does not apply to a farm mortgage if the farmer is in default and, relevantly, the Authority is satisfied that satisfactory mediation has taken place "in respect of the farm debt involved". Ms Waller borrowed $450,000 from HSI under a loan agreement ("the First Loan Agreement") secured by an "all monies" registered first mortgage over her farm ("the Registered Mortgage"). The Registered Mortgage, read with the First Loan Agreement, created a "farm mortgage" within the meaning of the Act. In October 2004 HSI gave Ms Waller a notice under the Act that she was in default and that HSI intended to take enforcement action. The parties took part in a mediation, as a result of which they entered into a further loan agreement ("the Second Loan Agreement"). In August 2006, after further default, the parties entered into another loan agreement ("the Third Loan Agreement"). In October 2006 the Authority issued HSI a s 11 certificate. It was common ground that the certificate was issued on the basis that a satisfactory mediation had taken place. Following Ms Waller's default under the Third Loan Agreement, HSI brought a successful claim in the Common Law Division of the Supreme Court of New South Wales for possession of Ms Waller's farm and judgment for the outstanding borrowings. By majority the Court of Appeal of the Supreme Court of New South Wales dismissed Ms Waller's appeal. Ms Waller appealed by special leave to the High Court. The primary issue on appeal to the High Court was whether the proceedings instituted by HSI concerned the same "farm mortgage" as that in respect of which the s 11 certificate had been issued. The Court held unanimously that they did not. The Court of Appeal had held that each of the Second and Third Loan Agreements discharged the preceding Loan Agreement. This meant that at the date of the proceedings the only obligations secured by the Registered Mortgage were under the Third Loan Agreement. The High Court held that the Third Loan Agreement, read with the Registered Mortgage, had created a new "farm mortgage". The subject of the mediation, and the certificate, was the debt owed under the First rather than the Third Loan Agreement. At the time of the proceedings there was therefore no certificate in force in respect of the farm mortgage. HSI was barred from taking any enforcement action against Ms Waller except in accordance with the Act. The definition of "enforcement action" in the Act included both the claim for possession and the claim for a money judgment.

HIGH COURT OF AUSTRALIA 1 September 2010 PUBLIC TRUSTEE OF QUEENSLAND v FORTRESS CREDIT CORPORATION (AUS) 11 PTY LTD & ORS [2010] HCA 29 Section 266 of the Corporations Act 2001 (Cth) provides that a charge, or a variation to the terms of a charge, will be void as a security unless notice of the charge or its variation is lodged with the Australian Securities and Investments Commission ("ASIC"). Today the High Court held that a deed, which did not amend the terms of a charge but, when read with the charge, had the effect of increasing the liabilities secured under it, did not trigger the operation of s 266. On 31 May 2007, Fortress Credit Corporation (Aus) 11 Pty Ltd ("Fortress") entered into a loan agreement with Young Village Estates Pty Ltd as borrower. The loan was guaranteed ("the YVE guarantee") by the second respondent, Octaviar Limited ("Octaviar"). No security was given for repayment of the loan. On 1 June 2007, Fortress entered into another loan agreement with Octaviar's subsidiary, Octaviar Castle Pty Ltd ("Octaviar Castle"), as borrower ("the Castle Facility Agreement"). Octaviar and another of its subsidiaries, Octaviar Administration Pty Ltd ("Octaviar Administration"), guaranteed that loan. Octaviar provided security for its guarantee by way of a fixed and floating charge. Notice of the charge was lodged with ASIC, in accordance with s 263 of the Corporations Act. Under clause 2.1 of the charge, Octaviar charged all its present and future property for payment of "Secured Money", defined in the charge as "all money, obligations and liabilities…owing or payable…under or in relation to a Transaction Document". The term "Transaction Document" was to have the meaning given to it in the Castle Facility Agreement, which provided that a "Transaction Document" included each document that Fortress and Octaviar agreed in writing was a Transaction Document. On 22 January 2008, Fortress, Octaviar and Octaviar Castle executed a deed acknowledging that the YVE guarantee was a "Transaction Document" for the purposes of the Castle Facility Agreement and thus within the terms of the charge. This had the effect of increasing the liabilities secured by the charge. No notice of any charge created or varied was lodged with ASIC. In late 2008, administrators were appointed to Octaviar and Octaviar Administration and each subsequently executed a deed of company arrangement. On 19 February 2009, the Public Trustee of Queensland applied to the Supreme Court of Queensland for orders terminating each deed. It contended that each deed had been premised on the validity in all respects of the charge, which, in the absence of a notice lodged with ASIC, did not validly secure the YVE guarantee. The Public Trustee submitted that the deed of 22 January 2008 was a new charge, or a variation in the terms of an existing charge, requiring lodgement of a notice with ASIC in accordance with s 263 or s 268 respectively of the Corporations Act. In the absence of such notice, a new charge would be void pursuant to s 266(1), and a varied charge void pursuant to s 266(3), of the Corporations Act. At first instance, McMurdo J ordered that the question of the validity of the charge be determined separately from the applications to terminate the deeds. His Honour held that the deed of 22 January 2008 amounted to a variation in the terms of the charge, by bringing the YVE guarantee within its coverage, and was void for failure to lodge notice of the variation. The Court of Appeal unanimously allowed an appeal from that decision. On 12 March 2010, the Public Trustee was granted special leave to appeal to the High Court. The Court unanimously dismissed the appeal, finding that the deed of 22 January 2008 was neither a new charge nor a variation in the terms of the charge. As a result of the 22 January 2008 deed, the YVE guarantee was now a "Transaction Document". However that did not vary the meaning of "Transaction Document" in the Castle Facility Agreement and consequently the meaning of "Secured Money" in the charge. The effect of the deed was that the YVE guarantee now fell within the class of liabilities secured by the charge; there was no variation made to the terms of the charge either in their text or in the rights and obligations to which those terms gave rise. Where parties elect that a term of a charge will be variable or ambulatory in operation, there is no variation in the terms each time its operation is, as a matter of fact, altered or modified. The Corporations Act requires notice only for variations in the terms of the charge, and not to modifications in the way in which those terms apply to the circumstances from time to time during the currency of the charge. The Court dismissed the appeal and ordered the Public Trustee to pay Fortress's costs.

HIGH COURT OF AUSTRALIA 8 December 2021 UMINISTER FOR IMMIGRATION, CITIZENSHIP, MIGRANT SERVICES AND [2021] HCA 41 Today, the High Court unanimously allowed an appeal from a decision of the Full Court of the Federal Court of Australia. The appeal concerned whether a decision of the appellant ("the Minister") not to revoke a decision to cancel the respondent's visa, pursuant to s 501CA(4)(b)(ii) of the Migration Act 1958 (Cth), was vitiated by jurisdictional error. Following the respondent's conviction for, amongst other things, seriously assaulting his partner, his temporary visa was cancelled under s 501(3A). Subsequently, the Minister decided there was not "another reason" to revoke that decision under s 501CA(4)(b)(ii). For the purposes of making representations to the Minister about whether there was "another reason" for revocation, the respondent represented that there was a "real prospect" that he and his partner and young child would go to American Samoa (his place of birth) where they would face "substantial impediments", including language and cultural barriers and problems accessing healthcare and welfare services. In his reasons for decision, the Minister addressed the respondent's concerns and made certain findings about the conditions in American Samoa and Samoa, including that English is widely spoken and regarding the availability of healthcare and welfare services. It was common ground that there was no evidentiary material to support the Minister's findings. The respondent sought judicial review of that decision in the Federal Court. Initially, his application was dismissed, but on appeal the Minister's decision was set aside. The majority concluded that the Minister had erred because, among other things, it was an implied condition for the exercise of the power conferred by s 501CA(4) that the Minister's state of satisfaction be formed on the basis of factual findings open to be made on the evidentiary materials. The majority also concluded that there was no evidence to support a finding that the Minister had relied upon his own personal knowledge about the conditions in American Samoa and Samoa. The High Court held that, when applying s 501CA(4), there are few mandatorily relevant matters the Minister must consider, and otherwise the power must be exercised reasonably and in good faith. If the representations received by the Minister in support of revocation lack any substance altogether, then this of itself might justify a decision not to be satisfied that "another reason" exists to revoke the cancellation decision, without any need to make any findings of fact about the various claims made. If the Minister in giving reasons makes a finding of fact, the Minister must do so based on some evidence or other supporting material, rather than no evidence or no material, unless the finding is made in accordance with the Minister's personal or specialised knowledge or by reference to that which is commonly known. In that respect, the Minister is free to adopt both the accumulated knowledge of the Department of Immigration, Citizenship, Migrant Services and Multicultural Affairs and any draft written reasons for decision prepared by a departmental officer, provided that such reasons reflect the reasons why the Minister had reached her or his decision. There is no express requirement that the Minister disclose whether a material finding is made from personal, specialised or accumulated knowledge. Nor was the Minister under any obligation to disclose his disagreement with the respondent's bare assertions and give the respondent yet another opportunity to make claims prior to making a decision.

HIGH COURT OF AUSTRALIA 11 October 2013 BONANG DARIUS MAGAMING v THE QUEEN [2013] HCA 40 Today the High Court, by majority, upheld the validity of a provision of the Migration Act 1958 (Cth) ("the Act") which prescribed a mandatory minimum term of imprisonment for the offence of facilitating the bringing or coming to Australia of a group of at least five non-citizens with no lawful right to come to Australia. The High Court held that the provision was not beyond the legislative power of the Commonwealth Parliament and did not confer judicial power on prosecuting authorities. On 6 September 2010, a boat carrying 52 passengers and four crew members was intercepted near Ashmore Reef. The appellant, Mr Magaming, was one of the crew members. The passengers on the boat were not Australian citizens and none had a lawful right to enter Australia. Mr Magaming was charged with one count of facilitating the bringing or coming to Australia of a group of at least five unlawful non-citizens contrary to s 233C(1) of the Act. The offence under s 233C(1) of the Act was an aggravated form of the people smuggling offence created by s 233A(1) of the Act, which prohibited facilitating the bringing or coming to Australia of an unlawful non-citizen. That offence carried no mandatory minimum term of imprisonment, whereas the offence under s 233C(1) of the Act carried a mandatory minimum sentence of five years' imprisonment with a minimum non-parole period of three years. Mr Magaming pleaded guilty in the District Court of New South Wales and was sentenced to the mandatory minimum term of five years' imprisonment with a non-parole period of three years. He sought leave to appeal to the Court of Criminal Appeal of the Supreme Court of New South Wales, alleging that the provision prescribing the mandatory minimum term of imprisonment was invalid. The Court of Criminal Appeal granted leave to appeal but dismissed the appeal, concluding that the relevant provision was valid. By special leave, Mr Magaming appealed to the High Court. In the High Court, Mr Magaming contended that in circumstances where prosecuting authorities could choose between charging an offence that carried a mandatory minimum sentence and charging another offence that carried no mandatory sentence, the prosecuting authorities impermissibly exercised judicial power. He also contended that the provision of the Act prescribing the mandatory minimum sentence was incompatible with the institutional integrity of the courts and that it required a court to impose a sentence that was arbitrary. By majority, the High Court dismissed the appeal. The High Court held that although prosecuting authorities had a choice as to which offence to charge, that choice did not involve an exercise of judicial power or confer on prosecuting authorities an ability to determine the punishment to be imposed for the same conduct, even where one available offence prescribed a mandatory minimum sentence. The High Court also held that the imposition of a mandatory minimum sentence was not inconsistent with the institutional integrity of the courts and did not involve the imposition of an arbitrary sentence.

HIGH COURT OF AUSTRALIA 5 October 2012 PLAINTIFF M47/2012 v DIRECTOR GENERAL OF SECURITY & ORS [2012] HCA 46 Today a majority of the High Court held invalid a regulation which prevented the grant of a protection visa to a refugee if the Australian Security Intelligence Organisation ("ASIO") had assessed the refugee to be a risk to security. Accordingly, a majority of the Court held that the decision to refuse the plaintiff a protection visa on the basis of that regulation had not been made according to law. The plaintiff, a Sri Lankan national, arrived in Australia in December 2009, and has been held in detention since that time. In June 2010, he applied for a protection visa. A delegate of the Minister for Immigration and Citizenship found that the plaintiff had a well-founded fear of persecution in Sri Lanka on the basis of his race or political opinion and was therefore a refugee. However, the delegate refused the plaintiff's application for a protection visa because, in December 2009, the plaintiff had been assessed by ASIO to be a risk to security. Clause 866.225 of Sched 2 to the Migration Regulations 1994 (Cth) prescribes as a criterion for the grant of a protection visa that the applicant not be assessed as a risk to security under the Australian Security Intelligence Organisation Act 1979 (Cth). This criterion is called public interest criterion 4002. The plaintiff commenced proceedings in the original jurisdiction of the High Court challenging the validity of the decision to refuse him a protection visa and challenging his continued detention. The plaintiff argued that ASIO had denied him procedural fairness when making a fresh adverse security assessment in 2012, that the requirement that he satisfy public interest criterion 4002 was invalid, and that the Migration Act 1958 (Cth) did not authorise the removal and detention of a person found to be a refugee. A majority of the Court held that the plaintiff was not denied procedural fairness in connection with the making of the security assessment because the plaintiff was given the opportunity to address issues of concern to ASIO in the interview that was conducted before the fresh assessment was made in 2012. However, a majority of the Court held that the Migration Regulations could not validly prescribe public interest criterion 4002 as a condition for the grant of a protection visa because doing so was inconsistent with the Migration Act 1958 (Cth). Because the prescription of public interest criterion 4002 as a criterion for the grant of a protection visa was invalid, a majority of the Court held that the decision to refuse the plaintiff a protection visa on the basis of this criterion had not been made according to law. Accordingly, the plaintiff's continuing detention was valid for the purpose of determining his application for a protection visa. Given these conclusions, it was unnecessary for the majority to consider the plaintiff's other arguments about the validity of his detention and proposed removal from Australia.

HIGH COURT OF AUSTRALIA 12 February 2014 MARK SHARNE SMITH v THE STATE OF WESTERN AUSTRALIA [2014] HCA 3 Today the High Court unanimously allowed an appeal against a decision of the Court of Appeal of the Supreme Court of Western Australia, which had held that a note found in the jury room after the jury had delivered its verdict could not be admitted as evidence. The note suggested that one juror may have been physically coerced by another juror into arriving at the verdict of guilty. On 17 January 2012, the appellant was convicted upon the verdict of a jury in the District Court of Western Australia of two counts of indecently dealing with a child under the age of 13 years. The following day, the trial judge informed counsel that a note in an envelope addressed to the judge had been found on the table in the jury room after the jury had been discharged. The note, which did not identify its author, was in the following terms: "I have been physically coerced by a fellow juror to change my plea to be aligned with the majority vote. This has made my ability to perform my duty as a juror on this panel [sic]". The trial judge was of the opinion that, because the verdict had already been entered, he could not do anything about the note. His Honour did, however, remark that there were a number of unusual factors surrounding the delivery of the verdict, including that one male juror seemed somewhat upset. The appellant appealed to the Court of Appeal on the ground that his trial had miscarried due to a juror being physically coerced into changing his verdict to guilty. The Court of Appeal unanimously dismissed the appeal, holding that the note was inadmissible and that no order should be made directing the Sheriff to make inquiries concerning the allegations raised in the note. By special leave, the appellant appealed to the High Court, arguing that the Court of Appeal failed to appreciate that the general rule which renders evidence of the conduct of jury deliberations inadmissible does not operate to preserve the secrecy of criminal conduct. The High Court held that, because the note was capable of giving rise to a reasonable apprehension or suspicion on the part of a fair-minded and informed member of the public that a juror did not discharge his task because of unlawful coercion, the Court of Appeal should have allowed the appellant's appeal. The High Court remitted the matter to the Court of Appeal to be heard and determined according to law.

HIGH COURT OF AUSTRALIA 9 February 2012 KIEU THI BUI v DIRECTOR OF PUBLIC PROSECUTIONS FOR THE COMMONWEALTH OF AUSTRALIA [2012] HCA 1 Today the High Court dismissed an appeal from the Court of Appeal of the Supreme Court of Victoria, which held that "double jeopardy" was not to be considered upon an appeal by the Commonwealth Director of Public Prosecutions ("DPP") under the Crimes Act 1914 (Cth) ("Crimes Act"). The appellant, Kieu Thi Bui, is an Australian citizen who carried drugs into Australia from Vietnam, contrary to the Criminal Code (Cth). She was apprehended by the Australian Federal Police on 11 February 2009, and was subsequently found to be concealing four pellets containing heroin within her body. After the drugs were discovered, the appellant co-operated with the police and undertook to assist law enforcement agencies. She pleaded guilty to importing a marketable quantity of a border controlled drug. The sentencing judge did not order a term of immediate imprisonment, on the basis that the appellant had co-operated, and undertook to continue co- operating, with law enforcement agencies, the danger attending her co-operation, and the risk of hardship to the appellant's infant twins. Her Honour sentenced the appellant to three years' imprisonment with an immediate release, upon giving security of $5000 to comply with the condition that the appellant be of good behaviour for three years. The DPP appealed against the sentence on the ground that it was manifestly inadequate. On appeal, the Court of Appeal identified errors in the sentencing judge's reasons by reference to s 16A of the Crimes Act. Under s 16A(1) of the Crimes Act, a court must impose a sentence that is of an appropriate severity in all the circumstances of the offence. Section 16A(2) specifies matters which must be taken into account if relevant and known to the court, including the probable effect of any sentence on the person's family or dependants and the person's "mental condition". The Court of Appeal held that the provisions of the Criminal Procedure Act 2009 (Vic) ("Criminal Procedure Act") required it to not take into account any element of double jeopardy involved in the appellant being re-sentenced. The Court of Appeal ordered a new sentence of four years' imprisonment, with a non-parole period of two years. The appellant appealed, by special leave, to the High Court of Australia. The High Court dismissed the appeal, with the result that the sentence ordered by the Court of Appeal stands. The High Court held that the provisions of the Criminal Procedure Act on which the Court of Appeal relied do not apply to appeals by the DPP for re-sentencing under the Crimes Act. The High Court rejected a submission that s 80 of the Judiciary Act 1903 (Cth) imported double jeopardy into the sentencing considerations under s 16A of the Crimes Act. There was no gap or omission in Commonwealth statute law such as to bring s 80 into operation. The High Court also held that there was no warrant for interpreting s 16A of the Crimes Act as incorporating concepts addressed only to an appellate court, such as notions derived from the rule against double jeopardy. Further, the High Court held that s 16A(2) of the Crimes Act does not refer to the stress and anxiety presumed to be suffered by convicted persons facing re-sentencing, but to such a mental condition which is demonstrated to exist in fact.

HIGH COURT OF AUSTRALIA 7 December 2011 JULIAN RONALD MOTI v THE QUEEN [2011] HCA 50 Today the High Court held that further prosecution of charges against Mr Julian Moti should be stayed as an abuse of process because Australian officials facilitated his deportation from Solomon Islands to Australia knowing that his deportation was, at that time, unlawful under Solomon Islands law. Mr Moti was an Australian citizen at all material times. He was Attorney-General of Solomon Islands between September 2006 and December 2007 with a suspension between October 2006 and July 2007. On 3 November 2008 Mr Moti was charged with seven counts of engaging in sexual intercourse with a person under the age of 16 years whilst outside Australia contrary to s 50BA of the Crimes Act 1914 (Cth). All counts related to one complainant and were alleged to have occurred in 1997. Four counts alleged conduct in the Republic of Vanuatu; the other three counts alleged conduct in New Caledonia. The complainant and members of her family who might be called to give evidence as prosecution witnesses gave statements to the police. The Commonwealth Director of Public Prosecutions advised the police that there were reasonable prospects of conviction. Australian authorities took steps towards securing Mr Moti's return to Australia, in particular, by making two requests in 2006 to the Solomon Islands Government for Mr Moti's extradition which were refused. Subsequently, between February 2008 and November 2009, the Australian Federal Police made payments of approximately $67,500 to the complainant and $81,600 to her family ("the payments"). The payments followed repeated statements by the complainant and her father to the effect that the complainant would not participate any further in the prosecution of Mr Moti unless she and her family were brought to Australia and given "financial protection". The payments were said to be made to provide for the "minimal daily needs" of the complainant and her family and, for part of the time, to provide accommodation in Vanuatu. The family were said to be unable to support themselves because the publicity given to the charges against Mr Moti adversely affected their ability to earn income. On 20 December 2007 there was a change of government in Solomon Islands. On 21 December 2007 a warrant for Mr Moti's arrest was issued in Brisbane. On 22 December 2007 Mr Moti applied for an injunction restraining his removal from Solomon Islands. This was refused. The judge noted that there were proper legislative procedures for initiating deportation which governed Mr Moti's rights and which would give him the opportunity to respond. Specifically, the Solomon Islands Deportation Act provided that a person on whom a deportation order was served could apply to the High Court, within seven days of service of the order, for review of the order and that deportation was only lawful if the person had not applied for review within that time or if, on review, the order was not set aside. On 22 December 2007 the Solomon Islands cabinet resolved to remove Mr Moti to Australia. On 24 December 2007 a deportation order in respect of Mr Moti was published in the Solomon Islands Gazette. A further application by Mr Moti for orders restraining his removal was dismissed on 24 December 2007, but another application on 25 December 2007 succeeded. The Acting High Commissioner of Australia in Honiara was of the opinion that Mr Moti had seven days in which to appeal to the High Court before he could lawfully be deported. The Acting High Commissioner conveyed that opinion to her superiors in Canberra. Despite this, her superiors authorised Australian officials in Solomon Islands to supply travel documents relating to Mr Moti knowing that those documents would be used to deport Mr Moti before his deportation was lawful. Mr Moti was removed to Australia on a flight on 27 December 2007. The primary judge in the Supreme Court of Queensland stayed further prosecution on the ground that the payments were an abuse of process but rejected Mr Moti's arguments based upon the circumstances of his deportation. The Court of Appeal set aside the stay ordered by the primary judge, holding that there was no abuse of process on either ground. Mr Moti appealed to the High Court by special leave. The High Court held by majority that further prosecution of the charges would be an abuse of process because of the role that Australian officials played in Mr Moti being deported to Australia. The Court rejected the proposition that the payments were an abuse of process.

HIGH COURT OF AUSTRALIA 12 December 2013 THE COMMONWEALTH OF AUSTRALIA v THE AUSTRALIAN CAPITAL TERRITORY [2013] HCA 55 Today the High Court decided unanimously that the Marriage Equality (Same Sex) Act 2013, enacted by the Legislative Assembly for the Australian Capital Territory, cannot operate concurrently with the federal Marriage Act 1961. The Court held that the federal Parliament has power under the Australian Constitution to legislate with respect to same sex marriage, and that under the Constitution and federal law as it now stands, whether same sex marriage should be provided for by law is a matter for the federal Parliament. The Court held that "marriage" in s 51(xxi) of the Constitution refers to a consensual union formed between natural persons in accordance with legally prescribed requirements which is not only a union the law recognises as intended to endure and be terminable only in accordance with law but also a union to which the law accords a status affecting and defining mutual rights and obligations. "Marriage" in s 51(xxi) includes a marriage between persons of the same sex. The Marriage Act does not now provide for the formation or recognition of marriage between same sex couples. The Marriage Act provides that a marriage can be solemnised in Australia only between a man and a woman and that a union solemnised in a foreign country between a same sex couple must not be recognised as a marriage in Australia. That Act is a comprehensive and exhaustive statement of the law of marriage. The Court held that the object of the ACT Act is to provide for marriage equality for same sex couples and not for some form of legally recognised relationship which is relevantly different from the relationship of marriage which federal law provides for and recognises. Accordingly, the ACT Act cannot operate concurrently with the federal Act. Because the ACT Act does not validly provide for the formation of same sex marriages, its provisions about the rights of parties to such marriages and the dissolution of such marriages cannot have separate operation and are also of no effect. The Court held that the whole of the ACT Act is of no effect.

HIGH COURT OF AUSTRALIA 7 March 2012 STRONG v WOOLWORTHS LIMITED T/AS BIG W & ANOR [2011] HCA 5 Today the High Court allowed an appeal from the Court of Appeal of the Supreme Court of New South Wales, which had dismissed a claim in negligence by the appellant against Woolworths on the basis that the appellant had failed to prove that Woolworths' negligence caused her injuries. The High Court held by majority that, on the balance of probabilities, Woolworths' negligence caused the appellant's injuries. The appellant suffered serious spinal injury when she slipped and fell while at the Centro Taree Shopping Centre ("the Centre"). The incident occurred at around 12.30pm. At the time of her fall, the appellant had an amputated right leg and walked with the aid of crutches. The fall occurred as the result of the tip of her right crutch coming into contact with a greasy chip that was lying on the floor of a sidewalk sales area which was under the care and control of Woolworths. The crutch slipped out from under her and she fell heavily. The appellant brought proceedings in the District Court of New South Wales claiming damages in negligence against Woolworths and CPT Manager Limited ("CPT"), which was the owner of the Centre. The appellant obtained judgment against Woolworths, and the claim against CPT was dismissed. Woolworths appealed to the New South Wales Court of Appeal. On appeal, the primary issue was whether the appellant had proved that Woolworths' negligence was the cause of her injury. It was not in question that Woolworths owed a duty to take reasonable care for the safety of persons coming into the sidewalk sales area, and that on the day of the appellant's fall Woolworths did not have any system in place for the periodic inspection and cleaning of that area. Prior to the appellant's fall, the sidewalk sales area had last been inspected at 8.00am that morning. The principles governing the determination of causation in a claim for negligence in New South Wales are set out in s 5D of the Civil Liability Act 2002 (NSW) ("the Act"). Section 5D of the Act relevantly requires that the negligence was a necessary condition of the occurrence of the harm ("factual causation") and that it is appropriate for the scope of the negligent person's liability to extend to the harm so caused ("scope of liability"). Applying the statutory test, the Court of Appeal held that the appellant had failed to prove on the balance of probabilities that Woolworths' negligence caused her fall. The Court approached the causation question on the basis that reasonable care in the circumstances required periodic inspection and necessary cleaning of the sidewalk sales area at 15 minute intervals throughout the day. The Court found that the likelihood was that the chip had been deposited at lunchtime. On that basis, the Court considered that it could not be concluded that, had there been a dedicated cleaning of the area every 15 minutes, it was more likely than not that the appellant would not have fallen. The Court set aside the judgement of the trial judge and dismissed the appeal. The appellant appealed by special leave to the High Court. The primary issue on appeal to the High Court was the correctness of the Court of Appeal's conclusion on causation. The High Court held by majority that, in the circumstances, it was an error for the Court of Appeal to hold that it could not be concluded that the chip had been on the ground for long enough to be detected and removed by the operation of a reasonable cleaning system. The evidence did not permit a finding of when, in the interval between 8.00am and 12.30pm, the chip was deposited in the sidewalk area. Given this, the probability was that it had been on the ground for more than 20 minutes prior to the appellant's fall. On the balance of probabilities, therefore, the appellant would not have fallen but for Woolworths' negligence.

HIGH COURT OF AUSTRALIA 13 December 2017 REGIONAL EXPRESS HOLDINGS LIMITED v AUSTRALIAN FEDERATION OF AIR PILOTS [2017] HCA 55 Today, the High Court unanimously dismissed an appeal from a decision of the Full Court of the Federal Court of Australia. The High Court held that an industrial association registered under the Fair Work (Registered Organisations) Act 2009 (Cth) ("the FWRO Act") is entitled to represent the industrial interests of a person, within the meaning of s 540(6)(b)(ii) of the Fair Work Act 2009 (Cth), where that person is eligible for membership of the industrial association pursuant to its eligibility rules but is not a member of the industrial association. The respondent is an industrial association registered as an organisation of employees under the FWRO Act. The appellant sent a letter to a number of persons to the effect that any person who completed its cadet programme and insisted on his or her workplace right to appropriate accommodation during layovers would not be given a position of command. The respondent alleged that the letter contravened various civil remedy provisions of the Fair Work Act and applied to the Federal Circuit Court of Australia for pecuniary penalty orders. The persons to whom the letter had been sent were not members of the respondent. The appellant applied to have the claim summarily dismissed on the basis that the respondent lacked standing because it was not an industrial association "entitled to represent the industrial interests of" the persons who had received the letter as required by s 540(6)(b)(ii) of the Fair Work Act. The primary judge dismissed that application, holding that, because the persons to whom the letter had been sent were eligible for membership of the respondent, the respondent was entitled to represent their industrial interests within the meaning of s 540(6)(b)(ii) of the Fair Work Act. The appellant appealed to the Full Court of the Federal Court. The Full Court dismissed the appeal, holding that an historical survey of legislative development of the expression "entitled to represent the industrial interests of" in s 540(6)(b)(ii) of the Fair Work Act demonstrated that it had been legislatively deployed and understood as allowing an industrial organisation to represent the industrial interests of employees who are eligible for membership of the organisation. By grant of special leave, the appellant appealed to the High Court. The Court held that, in the case of an industrial association which is registered as an organisation under the FWRO Act, the fact that a person is eligible for membership of the association in accordance with its eligibility rules is sufficient to make the association "entitled to represent the industrial interests of" that person within the meaning of s 540(6)(b)(ii) of the Fair Work Act. This construction was consistent with the context of the provision both within the Fair Work Act and against the background of its legislative history. Accordingly, the Full Court did not err in their construction of the expression and the appeal was dismissed.

HIGH COURT OF AUSTRALIA Public Information Officer 12 February 2009 STEPHEN EDWARD PARKER v COMPTROLLER-GENERAL OF CUSTOMS A man charged with evading duty on imported Scotch whisky was not denied procedural fairness by the New South Wales Court of Appeal when he was not invited to make submissions about an earlier decision of a lower court, the High Court of Australia held today. An Australian Customs Service investigation between 1987 and 1990 into suspected contraventions of the Customs Act and Spirits Act found that some importers were mixing local spirits made from grain and/or molasses into imported brandy before bottling. It was an offence to describe as brandy any spirit not wholly distilled from wine produced from grapes. Customs formed the view that two companies controlled by Stephen Parker – Lawpark Pty Ltd which imported and distributed alcoholic spirits and Breven Pty Ltd which ran a warehouse for imported spirits – and a third company, Kingswood Distillery Pty Ltd, were involved in such a scheme. In March 1990 Customs, relying upon notices to produce issued under section 214 of the Customs Act, sought books and documents covering the previous five years relating to a particular bottle of Cheval Napoleon Old French Brandy and all other imports. When this requirement was apparently not met, they carried out a search and seizure at Lawpark’s premises at Wetherill Park in Sydney using warrants issued under section 214 (which has since been repealed). Mr Parker was ultimately charged with other offences uncovered during the investigation into adulterated brandy. In 1992, the Comptroller-General of Customs (now known as the Chief Executive Officer of Customs) began proceedings in the New South Wales Supreme Court against Mr Parker, Lawpark, Breven, and another individual, Gary Thomas Lawler. Mr Parker was charged with the removal, without Customs’ authority, of almost 93,000 litres of Scotch whisky from the Breven warehouse and 13 counts of evasion of duty on the whisky totalling more than $3 million. Proceedings against him finally came on for hearing in April 2005. Proceedings against the other defendants had already been concluded. Mr Parker challenged the admissibility of the documents seized from Lawpark’s premises and contended that evidence had been obtained improperly or in contravention of an Australian law. He said the search and seizure power had not been enlivened because the notice to produce was invalid and that the documents seized did not relate to the bottle of brandy identified in the notice to produce. Under section 138 of the NSW Evidence Act, such evidence obtained improperly or in contravention of the law cannot be admitted unless the desirability of admitting it outweighs the undesirability of admitting it. The Comptroller-General conceded the notice to produce was deficient because it was imprecise about the documents to which it applied. Justice Carolyn Simpson adopted a 1988 ruling by the NSW District Court, In the matter of Lawrence Charles O’Neill, which held that section 214(3) authorising search and seizure was limited to documents pertaining to goods on which the notice to produce was based. She held that the range of documents went well beyond what was authorised by section 214 of the Customs Act. Although the seizure was unlawful she admitted the evidence under section 138 of the Evidence Act. Justice Simpson convicted Mr Parker on all 14 charges. She ordered him to pay a penalty of more than $10 million, which was 3.25 times the duty evaded, and a penalty of $12,000 for the unauthorised movement of goods, plus costs. Mr Parker appealed unsuccessfully to the NSW Court of Appeal, which held that Justice Simpson was mistaken in accepting the construction of section 214 in O’Neill. However, she correctly admitted the evidence. Customs had not shown wilful disregard of the Customs Act. The High Court granted Mr Parker special leave to appeal on the ground that the Court of Appeal had denied him procedural fairness by finding against him without notifying him of its intention to depart from the O’Neill decision and giving him an opportunity to respond. The High Court, by a 4-1 majority, dismissed the appeal. It held that Mr Parker was not deprived of the possibility of a successful outcome. The Court held that although the Court of Appeal disagreed with O’Neill, it decided the appeal on the basis that O’Neill was correctly decided which meant there was no prejudice to Mr Parker. Consideration by a court of the weight to be given to decisions that were not authoritative did not necessarily attract an obligation to invite submissions by the parties about those decisions. What was required was that the Court of Appeal gave the parties sufficient opportunity to be heard on all the issues and there was no relevant unfairness.

HIGH COURT OF AUSTRALIA Public Information Officer 15 November 2007 QUEENSLAND PREMIER MINES PTY LTD, FRANK GEORGE BECKINSALE, HELEN MARY BECKINSALE AND MARMINTA PTY LTD v WALTER MURDOCH FRENCH Registration of a transfer of a mortgage does not necessarily assign the right to recover money owed under a separate loan agreement, the High Court of Australia held today. In 1989, Seventeenth Febtor Pty Ltd loaned $415,000 to Queensland Premier Mines (QPM) and Mr and Mrs Beckinsale and $560,000 to QPM. The loans were for acquiring and developing land at Yeppoon on the central Queensland coast. Interest of 24 per cent was charged and the loans were collaterally secured by mortgages over specified land. The mortgages were granted by QPM in favour of Seventeenth Febtor. The Beckinsales were not a party to them. By a deed dated 18 December 1992, Seventeenth Febtor assigned its rights and interests in the mortgages and loan agreements to Mr “Rusty” French. No money was repaid. In 1999 Mr French told Mr Beckinsale he planned to sell the land covered by the mortgages. The outstanding principal and interest due under the loan agreements was $4 million. In 2000, Mr French accepted Mr Beckinsale’s offer on behalf of Marminta to buy back the mortgages for $950,000, but a dispute arose. Marminta commenced action in the Queensland Supreme Court for specific performance of the buy-back agreement. Mr French brought proceedings in the Victorian Supreme Court in 2002 to recover the money due under the loan agreements from QPM and the Beckinsales. QPM agreed to sell the development site, which included the mortgaged land, to Unison Properties for $2.44 million. Marminta was initially unsuccessful in its claim for specific performance but succeeded on appeal. The Queensland Court of Appeal ordered Mr French to do all that was necessary to enable Marminta to become the registered proprietor of the mortgages. In January 2004, a transfer of the mortgages to Marminta, Marminta’s release of mortgage, and a transfer of the estate to Unison Properties were registered. In the Victorian proceedings, which became the subject of the appeal to the High Court, Marminta contended that the right to sue upon the mortgages and to recover any debt under them vested in it when the transfer of the mortgages to it was registered which meant Marminta became the creditor of QPM and the Beckinsales of what was owed under the loan agreements. The Supreme Court made declarations sought by Marminta but the Victorian Court of Appeal unanimously gave judgment for Mr French for the balance owing by QPM and the Beckinsales under the loan agreements and for the rates and taxes he had been obliged to pay. QPM, the Beckinsales and Marminta appealed to the High Court, which unanimously dismissed the appeal. The appellants argued that the registration of a transfer of a mortgage effects an assignment of the right to recover money owed under a separate loan agreement secured by the bill of mortgage. They argued that this is so under section 62 of Queensland’s Land Title Act, which provides that, on registration of an instrument of transfer for interest in a lot, all the transferor’s rights vest in the transferee. However, the Court held that there were two separate and distinct covenants to pay: one contained in the loan agreement, which is freestanding and enforceable in its terms, and another under the mortgage. Section 62 did not justify a construction which allows the right to recovery of a debt merely collaterally secured by the mortgage. The debt sought to be recovered by Mr French arose under the loan agreements, not under the mortgage. He was assigned the right to recover the money owing under the loan agreements and Marminta was not an assignee from him. He retained the right to sue and recover that money from QPM and the Beckinsales.

HIGH COURT OF AUSTRALIA 7 April 2006 Public Information Officer ASSETINSURE PTY LIMITED (formerly Gerling Global Reinsurance Company of Australia Pty Limited) v NEW CAP REINSURANCE CORPORATION LIMITED (in liquidation), JOHN RAYMOND GIBBONS as liquidator to the first respondent, FARADAY UNDERWRITING LIMITED, AND NC RE CAPITAL LIMITED (in liquidation) A provision in the Insurance Act to the effect that, in a winding-up of an insurance company, Australian assets should be used in the first place to discharge Australian liabilities was interpreted by the High Court to refer to liabilities of all kinds, not only liabilities under contracts of insurance. The Court also held that under a provision of the Corporations Act insurance included reinsurance. New Cap, which operated as a reinsurer, went into voluntary administration in April 1999 and its creditors resolved that the company be wound up. AssetInsure, an Australian insurer, and Faraday Underwriting, part of a syndicate of British insurers providing cover in various parts of the world to AK Steel Corporation, were both reinsured with New Cap, which had in turn taken out re-reinsurance (or retrocession). Both AssetInsure and Faraday were among New Cap’s creditors. Proceedings were brought in the NSW Supreme Court to resolve issues related to New Cap’s winding-up and the manner in which proceeds should be distributed among creditors. Two issues remained to be resolved in the High Court. One concerned section 116 of the Insurance Act, that in a winding-up of an insurance company, assets in Australia shall only be used to discharge liabilities in Australia, unless there are no Australian liabilities. The other concerned whether section 562A of the Corporations Act applied to the proceeds of contracts of re-reinsurance. AssetInsure argued that “liabilities in Australia” in section 116 of the Insurance Act were limited to liabilities under insurance contracts and that the location of such liabilities was determined exclusively by section 31(4). However, Justice William Windeyer held that “liabilities in Australia” were not confined to liabilities arising only under insurance contracts and held that section 31(4) was not an exclusive basis for determining their location. This was upheld by a majority of the NSW Court of Appeal and by a 3-2 majority of the High Court. The majority held that “liabilities in Australia” included all liabilities arising in the course of business in Australia, such as rent, taxes, loan repayments, costs of goods, and wages. Section 31(4) provided that in certain circumstances specific liabilities undertaken under insurance contracts were “liabilities in Australia”, but the Court held this was not an exhaustive statement of “liabilities in Australia”. Justice Windeyer’s decision on the Corporations Act issue was unanimously upheld by the High Court after being overturned by the Court of Appeal. The issue was whether the priority afforded by section 562A applied only to the proceeds of contracts of reinsurance or whether it also applied to the proceeds of contracts of re-reinsurance, such as that taken out by New Cap against liabilities it might incur under reinsurance contracts issued to AssetInsure and Faraday. AssetInsure argued both it and Faraday were entitled to pay-outs New Cap had received from its re-reinsurers. Justice Windeyer held that the priority afforded by section 562A applied to both reinsurance and re-reinsurance contracts. The High Court unanimously allowed the appeal on the Corporations Act issue and, by majority, dismissed the part of the appeal relating to the Insurance Act issue, therefore restoring declarations and directions made by Justice Windeyer in relation to both issues.

HIGH COURT OF AUSTRALIA 18 March 2020 SWAN v THE QUEEN [2020] HCA 11 Today the High Court unanimously dismissed an appeal from a decision of the Court of Criminal Appeal of the Supreme Court of New South Wales. The appellant and an accomplice were charged with the murder of 79-year-old Mr Kormilets. Mr Kormilets was an active man who was in apparently good health when the appellant and the accomplice attacked him after breaking into his home, causing severe injuries to his brain, face, kidneys and chest. Following the assault, Mr Kormilets spent almost four months in hospital before being transferred to a high-level care facility. His mental and physical condition was so poor that he was unable to undertake, or comprehend, any daily living activities. Eight months after the assault, Mr Kormilets suffered a fracture to the neck of his left femur. A decision was made not to operate on Mr Kormilets and he died in hospital from the consequences of the fracture shortly thereafter. Whether the appellant caused Mr Kormilets' death was a live issue at trial. The Crown advanced three possible pathways for the jury to conclude that the appellant caused the death. The central issue before the Court of Criminal Appeal and the High Court was whether it was open to the jury to convict upon the third pathway: that Mr Kormilets' low quality of life as a consequence of the assault caused the decision not to undergo surgery, which would reasonably have been expected to save his life. The Court of Criminal Appeal concluded that there was sufficient evidence for this pathway to be open to the jury. There was no dispute on appeal that causation is satisfied where an accused's act is "a substantial or significant cause of death" or a "sufficiently substantial" cause of the death charged. The High Court unanimously held that on the evidence it was open to the jury to conclude that surgery was available and would reasonably have been expected to save Mr Kormilets' life, that Mr Kormilets or his son made a decision that the surgery should not be undertaken, and that the decision not to operate was motivated by Mr Kormilets' low quality of life due to the assault. Accordingly, it was open to the jury to convict the appellant on the third pathway of causation.

HIGH COURT OF AUSTRALIA 3 May 2017 TALACKO v BENNETT [2017] HCA 15 Today the High Court unanimously allowed an appeal from the Court of Appeal of the Supreme Court of Victoria. The High Court held that the Court of Appeal erred in concluding that s 15(2) of the Foreign Judgments Act 1991 (Cth) did not prevent the issue of a certificate under s 15(1) of that Act, even though the judgment in question could not be enforced by execution by reason of s 58(3) of the Bankruptcy Act 1966 (Cth). A dispute between three siblings concerning certain properties formerly owned by their parents in what is now the Czech Republic led to the commencement of legal proceedings in 1998. Those proceedings were compromised in February 2001 by written terms of settlement requiring one of the siblings, Jan Emil Talacko, to transfer all rights, title and interest in the properties to a nominated person. Mr Talacko reneged on that agreement, and in July 2005 the families of the other two siblings (collectively, "the respondents") reactivated the proceedings and in April 2008 obtained judgment. In November 2009, Mr Talacko was ordered to pay in excess of €10m as equitable compensation. On 4 July 2012, upon the respondents' request, the Prothonotary of the Supreme Court of Victoria issued a document entitled "Certificate of Finality of Judgment and Orders" in purported reliance on s 15(1) of the Foreign Judgments Act. The respondents intended to file that certificate in proceedings then on foot in the Czech Republic against Mr Talacko and his sons. By this time, Mr Talacko had been made bankrupt by order of the Federal Court of Australia. Upon becoming aware that the certificate had been issued, he began to take steps to have it set aside. He died intestate shortly after, and his widow ("the appellant"), who was appointed representative of Mr Talacko's estate, issued a summons in the Supreme Court of Victoria seeking orders that the certificate (and a subsequently issued replacement certificate) were invalid and should be set aside. On 4 February 2016 Sloss J declared the certificates to be invalid, relevantly on the basis that s 58(3) of Bankruptcy Act, which prevents creditors from enforcing any remedy against the property of a bankrupt in respect of a provable debt, operated to impose a "stay of enforcement of the judgment" within the meaning of s 15(2) of the Foreign Judgments Act and thus precluded the obtaining of a certificate under that Act. An appeal to the Court of Appeal was allowed on the basis that "stay of enforcement" referred only to a judicially ordered stay (or similar) and did not extend to include the statutory bar imposed by s 58(3) of the Bankruptcy Act. By special leave, the appellant appealed to the High Court. The Court held that the meaning of the word "stay" is not necessarily confined to stays imposed by courts, but is capable of including any legal impediment to execution upon the judgment. The Court held that the evident purpose of s 15(2) of the Foreign Judgments Act is to prevent an application for a certificate which, if granted, would facilitate the enforcement abroad of a judgment that cannot be enforced in Australia. The judgment debt in question, because of s 58(3) of the Bankruptcy Act, was in that category. The orders of the Court of Appeal were set aside, with the effect that the declaration of the primary judge was reinstated.

HIGH COURT OF AUSTRALIA 21 December 2016 SOUTHERN HAN BREAKFAST POINT PTY LTD (IN LIQUIDATION) v LEWENCE CONSTRUCTION PTY LTD & ORS [2016] HCA 52 Today the High Court unanimously allowed an appeal from the Court of Appeal of the Supreme Court of New South Wales. The High Court held that the existence of a reference date under a construction contract is a precondition to the making of a valid payment claim under s 13(1) of the Building and Construction Industry Security of Payment Act 1999 (NSW) ("the Act"). The appellant ("Southern Han") and the respondent ("Lewence") were parties to a construction contract for the construction by Lewence of an apartment block ("the Contract"). The Contract made provision for Lewence to "claim payment progressively" by making a "progress claim" on the 8th day of each calendar month for work under the Contract done to the 7th day of that month. On 27 October 2014, Southern Han gave Lewence a notice purporting to exercise its right under the Contract to take out of Lewence's hands the whole of the work remaining to be completed. Lewence treated the giving of that notice as repudiation of the Contract and purported to accept the repudiation and to terminate the Contract. On 4 December 2014, Lewence served on Southern Han a purported payment claim, which claimed payment for work carried out by Lewence up to 27 October 2014. Southern Han provided a payment schedule in response to Lewence's payment claim indicating that the amount it proposed to pay was nil. Lewence purported to make an application for adjudication. The adjudicator rejected an argument that he lacked jurisdiction and purported to determine the application. Southern Han sought a declaration in the Supreme Court that the purported determination was void or, alternatively, an order in the nature of certiorari quashing the purported determination. The primary judge made the declaration sought, construing the Act as requiring a reference date to have arisen under the Contract as a precondition to the making of a valid payment claim, and finding that there was no reference date to support Lewence's purported payment claim. The Court of Appeal allowed Lewence's appeal, holding that the existence of a reference date is not a precondition to the making of a valid payment claim under the Act. By grant of special leave, Southern Han appealed to the High Court. The High Court held that the reference in s 13(1) to a "person referred to in s 8(1) who is or who claims to be entitled to a progress payment" was to be construed as referring to a person who has undertaken to carry out construction work or supply related goods and services under a construction contract, and who therefore is entitled to a progress payment only on and from each reference date. The existence of a reference date under a construction contract within the meaning of s 8(1) was therefore a precondition to the making of a valid payment claim under s 13(1). There was nothing in the Contract to indicate an intention that Lewence's right to make progress claims was to survive termination, thus preventing a future reference date from arising. The High Court allowed the appeal, set aside the orders made by the Court of Appeal and in their place ordered that the appeal to the Court of Appeal be dismissed.

HIGH COURT OF AUSTRALIA Manager, Public Information 5 August 2009 AON RISK SERVICES AUSTRALIA LTD v AUSTRALIAN NATIONAL UNIVERSITY [2009] HCA 27 Three days into a four week trial the Australian National University (ANU) sought an adjournment in order to make an application to the Supreme Court of the Australian Capital Territory to amend its statement of claim against its insurance broker significantly, Aon Risk Services Australia Ltd. The primary judge granted the adjournment and leave to amend. The ACT Court of Appeal dismissed an appeal against that decision except in relation to costs. Today the High Court allowed an appeal against the decision of the Court of Appeal. The bushfires in and around Canberra in January 2003 destroyed property belonging to ANU at its Mt Stromlo complex. In December 2004, ANU commenced proceedings against three insurance companies claiming indemnity for the Mt Stromlo losses. It subsequently joined Aon to the proceeding, claiming that it had acted negligently in failing to renew insurance over certain ANU properties. A four week trial was listed to commence on 13 November 2006. On that day, ANU and two of the three insurance companies commenced mediation which led to the settlement of ANU’s claims against them. ANU also settled its claim against the third insurance company. Those three claims having been resolved, ANU sought an adjournment of the trial on the basis that certain events that occurred and information received before and during the mediation made it necessary to seek leave to amend its statement of claim against Aon. Despite Aon’s opposition, the primary judge granted the adjournment and also granted ANU leave to amend its claim against Aon substantially. A majority of the Court of Appeal dismissed Aon’s appeal against the primary judge’s orders but ordered ANU to pay costs to Aon arising out of the amendment on an indemnity basis. The High Court granted Aon special leave to appeal. All members of the Court considered the proposed amendments did not fall into the category of amendments to which Rule 501 of the Court Procedure Rules 2006 (ACT) applied, that is, amendments which were required to be made for the purpose of deciding the real issues in the proceeding, or for the purpose of avoiding multiple proceedings. Rule 502 was the applicable rule. It required the Court to exercise its discretion in deciding whether to grant leave to ANU to make the amendments. Taking into account the objects and purposes of the Rules as set out in Rule 21, matters relevant to the exercise of the discretion would include, but not be limited to, the extent of the delay in seeking to amend, and the costs associated with that delay; prejudice to the opposing party if leave were to be granted; the nature and importance of the amendment to the party applying; the point the litigation had reached, relative to the trial commencement date; prejudice to other litigants awaiting trial dates; and the proposing party’s explanation for the delay in applying for the amendment. To the extent that statements in the case of Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 suggested only a limited application for case management principles in determining applications for leave to amend, the Court held that such statements should not be applied in the future. The High Court held that the primary judge and the majority in the Court of Appeal had not had sufficient regard to the following salient features of ANU’s application for leave to amend: it sought to introduce new and substantial claims which would require Aon to prepare a new defence as if from the beginning; the application was brought during the time which had been set for trial and would result in the abandonment of the remaining scheduled weeks of trial; it was not clear that even an order for indemnity costs would overcome the prejudicial effects on Aon; and ANU had offered no explanation about why the case had been allowed to proceed to trial in its existing form when the basis upon which it was now seeking to amend had been known to it for at least 12 months. The abandonment of the trial date would also have had deleterious effects on other litigants whose trial dates would have to be put back. In the Court’s view, adjourning the trial date and granting ANU leave to amend in the circumstances of this case was contrary to the case management objectives set out in Rule 21 of the Rules. The High Court allowed Aon’s appeal and ordered that ANU’s application for leave to amend its statement of claim be dismissed.

HIGH COURT OF AUSTRALIA 18 December 2013 UNIONS NSW & ORS v STATE OF NEW SOUTH WALES [2013] HCA 58 Today the High Court unanimously held that ss 96D and 95G(6) of the Election Funding, Expenditure and Disclosures Act 1981 (NSW) ("the EFED Act") are invalid because they impermissibly burden the implied freedom of communication on governmental and political matters, contrary to the Commonwealth Constitution. Section 96D of the EFED Act prohibits the making of a political donation to a political party, elected member, group, candidate or third-party campaigner, unless the donor is an individual enrolled on the electoral roll for State, federal or local government elections. The EFED Act also caps the total expenditure that political parties, candidates and third-party campaigners can incur for political advertising and related election material. For the purposes of this cap, s 95G(6) of the EFED Act aggregates the amount spent on electoral communication by a political party and by any affiliated organisation of that party. An "affiliated organisation" of a party is defined as a body or organisation "that is authorised under the rules of that party to appoint delegates to the governing body of that party or to participate in pre-selection of candidates for that party (or both)". Each of the plaintiffs intends to make political donations to the Australian Labor Party, the Australian Labor Party (NSW Branch) or other entities, and to incur electoral communication expenditure within the meaning of the EFED Act. The second, third and sixth plaintiffs are authorised to appoint delegates to the annual conference of the Australian Labor Party (NSW Branch) and to participate in the pre-selection of that party's candidates for State elections. A special case stated questions of law for determination by the High Court. The High Court unanimously held that ss 96D and 95G(6) burdened the implied freedom of communication on governmental and political matters. that political communication at a State level may have a federal dimension. The Court accepted that the EFED Act had general anti-corruption purposes. However, the Court held that the impugned provisions were not connected to those purposes or any other legitimate end. The Court held

HIGH COURT OF AUSTRALIA Public Information Officer 9 April, 2003 AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v C G BERBATIS HOLDINGS PTY LTD & ORS The High Court of Australia today dismissed an appeal by the ACCC which alleged a shopping centre’s insistence on tenants discontinuing litigation if they wanted their lease renewed constituted unconscionable conduct under the Trade Practices Act. The High Court held, by a 4-1 majority, that the tenant was not under any special disadvantage or disability. Inequality of bargaining power was not in itself a special disadvantage. The problem for the tenants was that they had no option to renew their lease. This was not a relevant form of disability for the purposes of the law relating to unconscionable conduct. Margaret and James Roberts ran a seafood shop in Farrington Fayre Shopping Centre in the Perth suburb of Leeming from 1989 until the end of 1996 when they sold the business. The Roberts’ lease was due to expire in early 1997 and the sale was on the basis that a new lease was granted. The Roberts had joined other tenants in legal proceedings against the owners for various charges imposed on them under their leases. The shopping centre owners said they would renew the Roberts’ lease but only on condition that they abandoned the litigation. The Roberts felt they had no choice but to agree. In 1998, the ACCC instituted Federal Court proceedings, claiming that the condition that the Roberts withdraw from litigation contravened section 51AA of the Trade Practices Act which prohibits unconscionable conduct by corporations. Justice French held that the owners had breached s 51AA, but his decision was overturned by the Full Court of the Federal Court. The ACCC appealed to the High Court. The Court dismissed the appeal, holding that taking advantage of a superior bargaining position was not to be confused with unconscientious exploitation of another’s inability to protect their own interests. The Court held that the Roberts were not under any relevant disability, nor was the shopping centre’s owners’ conduct unconscionable.

HIGH COURT OF AUSTRALIA 14 September 2012 THE PILBARA INFRASTRUCTURE PTY LTD & ANOR v AUSTRALIAN COMPETITION TRIBUNAL & ORS; THE NATIONAL COMPETITION COUNCIL v HAMERSLEY IRON PTY LTD & ORS; THE NATIONAL COMPETITION COUNCIL v ROBE RIVER MINING CO PTY LTD & ORS [2012] HCA 36 The High Court today held that the Australian Competition Tribunal’s review of the Minister’s decision whether to declare certain services relating to railway lines in the Pilbara under Part IIIA of the Trade Practices Act 1974 (Cth) (now the Competition and Consumer Act 2010 (Cth)) ("the Act") had not been undertaken according to law. Part IIIA of the Act provides for processes by which third parties may obtain access to infrastructure owned by others. The High Court quashed the Tribunal’s determinations and remitted the matters to the Tribunal for determination according to law. The dispute related to four railway lines in the Pilbara: the Goldsworthy line and the Mt Newman line operated by BHP Billiton Iron Ore Pty Ltd and BHP Billiton Minerals Pty Ltd (together, "BHPB"), and the Hamersley line and the Robe line operated by Rio Tinto Ltd and its associated entities ("Rio Tinto"). Fortescue Metals Group Limited ("FMG") or its wholly owned subsidiary, The Pilbara Infrastructure Pty Ltd ("TPI"), applied to have the services declared under the Act. The Minister declared the services relating to the Hamersley, Robe and Goldsworthy lines for a period of 20 years but did not declare the Mt Newman line services. FMG, BHPB and Rio Tinto appealed to the Tribunal. At the hearing before the Tribunal, the parties presented materials and evidence far in excess of what was placed before the Minister. The Tribunal ruled the Mt Newman line services should not be declared, the Goldsworthy line services should be declared for 20 years, the Hamersley line services should not be declared and the Robe line services should be declared for 10 years until 2018. FMG and Rio Tinto both applied to the Full Court of the Federal Court for judicial review of the Tribunal’s decision. The Full Court dismissed FMG’s applications and allowed Rio Tinto’s application, and set aside the decision of the Tribunal regarding the Robe line services. By special leave, FMG and TPI appealed to the High Court. The appeal to the High Court raised three issues. First, what is the meaning of the expression, "uneconomical for anyone to develop another facility to provide the service" under s 44H(4)(b) of the Act? Second, what matters can be taken into account under s 44H(4)(f) of the Act when the section requires the decision maker to be satisfied that access to the services "would not be contrary to the public interest"? Third, if a decision maker was satisfied as to the matters stated in s 44H(4) of the Act, was there a residual discretion to be exercised? During the hearing of the appeal, an issue was raised as to the nature of the task the Tribunal was required to perform when asked to review the Minister’s decision. The High Court held that the Tribunal should have considered only those materials considered by the Minister supplemented, if necessary, by any information, assistance or report given to the Tribunal by the National Competition Council in response to a request made under s 44K(6) of the Act. On the other issues considered on appeal, a majority of the High Court ruled that the expression, "uneconomical for anyone to develop another facility to provide the service" in s 44H(4)(b) of the Act required an inquiry whether there was anyone who could profitably develop another facility. The Court held that the requirement that the decision maker be satisfied that access to the services "would not be contrary to the public interest" needed to be applied in the context of the limited scope of review by the Tribunal. Finally, the Court held that, if a decision maker was satisfied as to the matters stated in s 44H(4) of the Act, there was no residual discretion to be exercised.

HIGH COURT OF AUSTRALIA 14 October 2020 ABT17 v MINISTER FOR IMMIGRATION AND BORDER PROTECTION & ANOR [2020] HCA 34 Today the High Court unanimously allowed an appeal from a judgment of the Federal Court of Australia. The appeal concerned a review by the Immigration Assessment Authority ("the IAA") under Pt 7AA of the Migration Act 1958 (Cth) ("the Act") of a decision of a delegate of the Minister for Immigration and Border Protection ("the Minister") to refuse to grant the appellant a temporary protection visa. The issue raised by the appeal was whether it was legally unreasonable for the IAA to depart from the delegate's assessment of the appellant's credibility without inviting the appellant to an interview to obtain new information. Subject to Pt 7AA of the Act, under s 473DB the IAA is required to review a fast track reviewable decision by considering the review material provided to it, and without accepting new information or interviewing the applicant. Under s 473DC, the IAA may get new information that was not before the Minister and that the IAA considers may be relevant, and the IAA may invite the person to give the new information at an interview. However, under s 473DD the IAA must not consider new information unless it is satisfied that there are exceptional circumstances, and that either the new information was not and could not have been provided to the Minister or that it is credible personal information. The appellant lodged an application for a temporary protection visa which was refused by a delegate of the Minister. While the delegate found that the appellant's evidence during the visa interview was plausible, the delegate was not satisfied that the appellant faced a well-founded fear of persecution based on country information concerning improved circumstances relating to Tamils in Sri Lanka. The delegate's decision was referred to the IAA for review. The IAA affirmed the delegate's decision. After reviewing the audio recording of the interview, the IAA accepted some of the appellant's claims but found that others were exaggerated and embellished. As the IAA did not accept the appellant's account of events, and considered there was otherwise no credible information to indicate he was of interest to Sri Lankan authorities, it concluded that the appellant did not have a well-founded fear of persecution. The IAA further held that this conclusion was supported by the country information considered by the delegate. An application for judicial review was dismissed by the Federal Circuit Court. On appeal to the Federal Court, the appellant contended that the IAA's decision was legally unreasonable because it made credibility findings contrary to those of the delegate without inviting the appellant to an interview. However, the Court held that it was not necessary to decide this issue, and dismissed the appeal on the basis that any failure to interview the appellant was not material to the IAA's decision because it was independently supportable by the country information relied on by both the delegate and the IAA. On appeal to the High Court, the Court unanimously held that in the circumstances of this case it was legally unreasonable for the IAA to depart from the delegate's assessment of the appellant's credibility. The plurality held that the legal unreasonableness arose from the IAA having departed from the delegate's assessment of the appellant's credibility without exercising its power under s 473DC of the Act to invite the appellant to an interview to obtain new information. The remaining Justices held that it was legally unreasonable for the IAA to depart from the delegate's assessment of the appellant's credibility in the circumstances, but that it either may not have been or was not open to the IAA to interview the appellant because the appellant's demeanour was not "new information" within the meaning of s 473DC of the Act.

HIGH COURT OF AUSTRALIA 22 August 2011 HIH CLAIMS SUPPORT LIMITED v INSURANCE AUSTRALIA LIMITED [2011] HCA 31 Today the High Court dismissed an appeal by HIH Claims Support Limited ("HCSL") from a decision of the Court of Appeal of the Supreme Court of Victoria. The High Court upheld the Court of Appeal's finding that HCSL was not entitled to equitable contribution from Insurance Australia Limited ("IAL") in respect of amounts HCSL had paid to satisfy certain liabilities incurred by Mr Ronald Steele. Steele was sub-contracted to erect a scaffold at Albert Park, Melbourne, for the 1998 Australian Grand Prix. He was insured under a general liability insurance policy ("the HIH policy") issued by a company ("HIH") in the HIH group of insurance companies ("the HIH Group"). As a sub-contractor of the Australian Grand Prix Corporation, Steele was also insured under a policy issued by IAL's predecessor in title. In March 1998, Steele's scaffold collapsed and damaged a valuable "jumbotron" video screen. The operator of the screen subsequently won an action against Steele in the Supreme Court of New South Wales ("the NSW proceeding") for damages for losses caused by the collapse of the scaffold. Steele made a claim under the HIH policy in relation to the incident and any liability established in the NSW proceeding. HIH accepted his claim. However, before the trial in the NSW proceeding, the HIH Group collapsed. In 2001, the Commonwealth Government established a scheme for providing financial assistance to policyholders, insureds and beneficiaries under insurance policies issued by the HIH Group who had suffered loss as a result of the collapse of the HIH Group ("the Scheme"). HCSL was appointed as the Scheme's trustee, administrator and manager. Steele applied and was accepted for assistance. In accordance with the Scheme, Steele assigned to HCSL all of his rights against HIH, including his right to prove in the liquidation of HIH. In return, HCSL paid 90 per cent of the amount HIH would have paid under the HIH policy in satisfaction of Steele's liability and his costs in defending the NSW proceeding, excluding some amounts HIH had already paid. HCSL then brought proceedings against IAL in the Supreme Court of Victoria, seeking equitable contribution in the sum of one half of all of the payments HCSL had made in respect of Steele. Both the primary judge and the Court of Appeal dismissed HCSL's claim. HCSL was granted special leave to appeal to the High Court. The High Court dismissed the appeal on the basis that the liabilities of HCSL and IAL were not co-ordinate. The parties did not share a common burden because the Scheme was structured to prevent contractual obligations between HCSL and Steele from arising if Steele had already been indemnified by IAL and to prevent IAL from claiming equitable contribution from HCSL. Further, in its contract to indemnify Steele, HCSL did not undertake the same risk as IAL had undertaken in its insurance policy covering Steele.

HIGH COURT OF AUSTRALIA Public Information Officer 14 June 2006 LOMANI JOEY KOROITAMANA (an infant by her next friend Sereana Naikelekele) AND MEREANI DIVOLIVOLI ((an infant by her next friend Sereana Naikelekele) v COMMONWEALTH OF AUSTRALIA AND MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS Two girls, who were born in Australia to Fijian parents, and who have the right to take out Fijian citizenship but who have not done so, are aliens under Australian law, the High Court of Australia held today. Lomani was born in Australia on 26 August 2000 and Mereani on 3 September 1998. They have remained continuously in Australia. Neither their mother, Sereana Naikelekele, nor their father, Maika Koroitamana, is an Australian citizen or a permanent resident and neither girl is an Australian citizen. Under the Constitution of Fiji, the girls may become citizens of Fiji by registration, but no application for registration has been made by them or on their behalf. The girls, who have been placed in immigration detention, commenced proceedings to challenge section 189 of the Migration Act which provides for detention of unlawful non-citizens and section 198 which provides for removal from Australia of unlawful non-citizens. They claim that under section 51(xix) of the Constitution the power to make laws with respect naturalisation and aliens does not extend to a power to treat them as aliens. In the Federal Court of Australia, Justice Arthur Emmett stated a case for the consideration of the Full Court which answered “yes” to the question of whether the girls were aliens within the meaning of section 51(xix). Lomani and Mereani sought special leave to appeal to the High Court. Their application was referred to a Full Court of seven Justices and argued fully as on an appeal. The Court unanimously granted the application for leave to appeal but dismissed the appeal. In 2004, the Court, by a 5-2 majority, in Singh v Commonwealth held that birth in Australia does not of itself mean that a person is beyond the reach of the power conferred on Parliament by section 51(xix) and does not mean that that person cannot be treated as an alien. Tania Singh was born in Australia to Indian parents. Lomani and Mereani said the difference between their case and Singh was that Tania was a citizen of India by descent from her parents whereas they are not citizens of Fiji. They argued that a person born in Australia could not possibly answer the description of “alien” unless they could be shown to have foreign allegiance. The Court held that it is open to Parliament to decide that an Australian-born child of parents who are foreign nationals is not automatically entitled to citizenship.

HIGH COURT OF AUSTRALIA Public Information Officer 8 March 2006 JASON CHARLES BUCKLEY v THE QUEEN Errors were made in assessing whether Mr Buckley should be jailed indefinitely and the Queensland Court of Appeal must re-examine the case in accordance with principles governing the exceptional imposition of indefinite sentences, the High Court of Australia held today. Mr Buckley, 34, pleaded guilty to five counts of rape, and one count each of burglary with violence, indecent assault and inflicting grievous bodily harm, arising from three violent attacks on women, one in Dalby and two in Toowoomba, between March 1999 and January 2000. Under Part 10 of the Queensland Penalties and Sentences Act, a court may impose an indefinite sentence on an offender convicted of violent offences if a court is satisfied that they are a serious danger to the community. The court must state the prison term that would otherwise be imposed – in Mr Buckley's case, 22 years – which affected reviews of the indefinite sentence and any new term that might be set if the indefinite term is lifted. The court must have regard to whether the nature of the offence is exceptional and to the offender's age, background, character, psychiatric or other reports, the risk of serious harm to the community, and the need to protect the community from such risk. The court must set out detailed reasons for imposing an indefinite sentence. The Court of Appeal, by majority, refused Mr Buckley's application for leave to appeal. Justice Catherine Holmes in dissent would have granted leave to appeal, as she found that there were three material errors of fact made by Judge Warren Howell. However, she would have come to the same conclusion that an indefinite sentence should be imposed. The High Court unanimously allowed the appeal. It agreed with Justice Holmes's findings of errors of fact but it held that, more significantly, Judge Howell had failed to apply the principles applicable to a decision as to whether to impose an indefinite sentence. The Court held that Mr Buckley's case was one where Part 10 of the Act could apply but the outcome was not inevitable and the Court of Appeal should have given leave to appeal and exercised its own discretion. The Court remitted the matter to the Court of Appeal for reconsideration.

HIGH COURT OF AUSTRALIA 3 February 2021 MINISTER FOR IMMIGRATION AND BORDER PROTECTION v MAKASA [2021] HCA 1 On 12 November 2020, the High Court unanimously dismissed an appeal from a judgment of the Full Court of the Federal Court of Australia ("Full Court"). Today, the High Court published its reasons for that decision. The question for determination was whether the Minister for Immigration and Border Protection ("the Minister") could re-exercise the power conferred by s 501(2) of the Migration Act 1958 (Cth) ("the Act") to cancel a visa on character grounds after the Administrative Appeals Tribunal ("AAT") had set aside a prior decision of the delegate of the Minister to cancel the visa and substituted a decision that the visa should not be cancelled. Following the AAT's decision, the respondent was subsequently convicted and sentenced in relation to two further offences involving failing to comply with reporting obligations and driving under the influence of alcohol. Being satisfied that the respondent failed to pass the character test solely by reason of the sentences imposed in respect of the earlier convictions that formed the basis of the first cancellation decision, but taking the subsequent convictions into account in the exercise of discretion, the Minister personally purported to re-exercise the power conferred by s 501(2) of the Act to cancel the respondent's visa. The respondent applied to the Federal Court of Australia for judicial review of the Minister's decision, which was dismissed at first instance. On appeal, the Full Court, by majority, allowed the respondent's appeal. By grant of special leave, the Minister appealed to the High Court. The High Court upheld the orders of the Full Court but gave different reasons for its decision. The High Court reasoned that the answer to the question for determination turned on whether, and to what extent, there appeared sufficiently for the purposes of s 2 of the Acts Interpretation Act 1901 (Cth) ("the AI Act") an intention contrary to the application of the general prescription in s 33(1) of the AI Act that a statutory power "may be exercised ... from time to time as occasion requires". The High Court held that, where there is no different factual basis on which to form a reasonable suspicion that a person does not pass the character test, such an intention emerges by reference to two principal considerations. The first is inherent in the nature of the merits review function of the AAT. The function of the AAT, the High Court observed, is "to do over again" that which was done by the primary decision-maker, and that function would be reduced to a mockery were the subject-matter of the primary decision made by the AAT on review able to be revisited by the primary decision-maker in the unqualified re-exercise of the same statutory power already re-exercised by the AAT in the conduct of the review. The second is the existence of s 501A of the Act, which confers a power on the Minister to personally re-exercise the power conferred by s 501(2) in certain circumstances. The High Court held that the existence of the special power, subject to limitations and qualifications, means that the general power conferred by s 501(2) cannot be exercised to do that which is the subject of the special power. The result is that the Minister can only re-exercise the power under s 501(2) either in reliance on s 501A or where subsequent events or further information provide a different factual basis for forming a reasonable suspicion that the person does not pass the character test.

HIGH COURT OF AUSTRALIA 18 October 2017 BRF038 v THE REPUBLIC OF NAURU [2017] HCA 44 Today the High Court unanimously allowed an appeal from the Supreme Court of Nauru. The High Court held that the Supreme Court erred in failing to hold that the Refugee Status Review Tribunal ("the Tribunal") had failed to accord the appellant procedural fairness. The appellant is from the Awdal province in Somaliland, an autonomous region in Somalia. He is a Sunni Muslim and a member of the Gabooye tribe. In September 2013, the appellant arrived by boat at Christmas Island. He was subsequently transferred to the Republic of Nauru. There he applied to the Secretary of the Department of Justice and Border Control of Nauru ("the Secretary") for refugee status. As part of that application, the appellant stated that the Somalian authorities were unwilling to assist him and his family due to their ethnicity. His application was refused by the Secretary. The appellant's application to the Tribunal for review of the Secretary's determination failed, as the Tribunal found that the harm that the appellant and his family faced constituted discrimination, but did not rise to the level of persecution. In the course of directly addressing the question whether the appellant had a well-founded fear of persecution as a result of his membership of the Gabooye tribe, the Tribunal observed that there was country information indicating that there are "police from every tribe in Somaliland, so [the appellant] would have some redress from the acts of others". An "appeal" to the Supreme Court pursuant to s 43(1) of the Refugees Convention Act 2012 (Nr) was dismissed. The appellant appealed to the High Court on the grounds that the Supreme Court erred in failing to hold that (i) the Tribunal applied the wrong test in determining whether the appellant suffered "persecution" within the meaning of the Convention relating to the Status of Refugees by requiring the total deprivation of the appellant's human rights in order to find that he faced persecution, and (ii) the Tribunal's failure to put the substance of the country information relating to the tribal composition of the Somaliland police to him constituted a breach of the requirements of procedural fairness contemplated by s 22 of the Refugees Convention Act. The High Court held that the Supreme Court of Nauru was exercising its original jurisdiction in conducting judicial review of the Tribunal's decision. Accordingly, the appeal to the High Court lay as of right. The Court held that the Tribunal did not purport to articulate an exhaustive test for persecution that could only be satisfied by the total deprivation of a person's human rights and that it was open to the Tribunal to conclude that the appellant was not faced with a well-founded fear of "persecution" within the meaning of the Refugees Convention. Finally, the Court held that the Tribunal's reliance on the tribal composition of the Somaliland police force was integral to the Tribunal's reasons for its conclusion, and therefore its failure to bring the country information to the appellant's attention amounted to a failure to accord him procedural fairness. The Court therefore allowed the appeal, set aside the order of the Supreme Court and ordered that the decision of the Tribunal be quashed and the matter be remitted to the Tribunal for reconsideration according to law.

HIGH COURT OF AUSTRALIA 13 February 2019 [2019] HCA 5 Today the High Court unanimously allowed an appeal from a decision of the Court of Criminal Appeal of the Supreme Court of New South Wales, quashed the appellant's conviction and ordered a new trial. The appellant was tried with a co-accused before a judge and jury in the District Court of New South Wales on an indictment charging him with drug-related offences. The appellant was the movements manager of a company that transported freight under bond from cargo terminal operators at the airport to freight-forwarding agencies. The charges related to, amongst other things, three consignments of freight and $400,150 in cash which was located in a tin box in the appellant's bedroom. The appellant gave evidence that the cash was the product of his success as a gambler. The appellant also held a number of online betting accounts, through which the appellant had made net losses, which the appellant's counsel erroneously relied upon as evidence of the appellant's success as a gambler. During the trial judge's summing-up to the jury, he suggested that the first consignment may well have contained drugs, the importation of which was the responsibility of the appellant as part of "an organisation of great sophistication". No such suggestion had been made by the prosecution at trial. The trial judge also suggested that a text message sent by the appellant to his co-accused showed that the appellant was knowingly involved in the importation of drugs. The trial judge also commented on the evidence of the appellant's online betting accounts. In doing so, the trial judge went beyond correcting the erroneous reliance by the appellant's counsel on the accounts as proof of the appellant's success as a gambler, and belittled the appellant's counsel. The appellant was convicted and subsequently sentenced to imprisonment for 18 years and nine months, with a non-parole period of 11 years and nine months. He appealed against his conviction to the Court of Criminal Appeal, alleging that the trial judge's summing-up to the jury occasioned a miscarriage of justice. A majority of the Court of Criminal Appeal held that the trial judge's comments did not occasion a miscarriage of justice. By grant of special leave, the appellant appealed to the High Court. The Court unanimously held that the trial judge's comments were so lacking in balance as to be an exercise in persuading the jury of the appellant's guilt, were unfair to the appellant, and gave rise to a miscarriage of justice. As a result, the Court quashed the appellant's conviction and ordered a new trial. A majority of the Court also held that trial judges should refrain from making comments that convey their opinion as to the proper determination of a disputed issue of fact to be determined by the jury.

HIGH COURT OF AUSTRALIA 11 May 2011 SPRINGFIELD LAND CORPORATION (NO 2) PTY LTD & ANOR v STATE OF QUEENSLAND & ANOR [2011] HCA 15 The High Court today dismissed an appeal brought by Springfield Land Corporation Pty Ltd and Springfield Land Corporation (No 2) Pty Ltd ("the Springfield companies") against a decision of the Queensland Court of Appeal. The Court of Appeal had upheld a decision of the Supreme Court denying the Springfield companies compensation from the State of Queensland, determined pursuant to the Acquisition of Land Act 1967 (Q) ("the Acquisition Act"), for the transfer of certain land to the State. The Springfield companies and the State of Queensland entered into an agreement for the Springfield companies to transfer certain land at Springfield near Ipswich to the State, with compensation for the transferred land to be assessed as if the State had acquired the land under the Acquisition Act. The transferred land was to be amalgamated with other land owned by the Department of Main Roads in an area designated as the "South West Transport Corridor". Section 20(3) of the Acquisition Act required that, in assessing the compensation to be paid, there be taken into consideration, by way of set-off or abatement, any enhancement in the value of the interest of the claimant in land adjoining the acquired land as a result of the carrying out of the purpose for which the land was acquired. The State of Queensland argued that the Springfield companies were not entitled to any compensation because of the enhancement of value of the land owned by the Springfield companies adjoining the transferred land resulting from the proposed use of the land for the facilitation of transport infrastructure. The State's claim was rejected by an arbitrator, who was appointed under the agreement between the parties to determine the quantum of compensation. The arbitrator awarded the Springfield companies $1,468,406. However, both the Supreme Court and the Court of Appeal accepted the State of Queensland's argument and awarded no compensation to the Springfield companies. The High Court, by majority, held that the relevant purpose of the acquisition of the land by the State of Queensland was for future transport purposes, including the facilitation of transport infrastructure for the South West Transport Corridor. As this purpose enhanced the value of the adjoining land owned by the Springfield companies so as to exceed the value of the transferred land, no compensation was required to be paid to the Springfield companies. The Springfield companies were ordered to pay the respondents' costs.

HIGH COURT OF AUSTRALIA 29 August 2007 Public Information Officer AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v BAXTER HEALTHCARE PTY LTD, THE STATE OF WESTERN AUSTRALIA, THE STATE OF SOUTH AUSTRALIA AND THE STATE OF NEW SOUTH WALES A corporation does not derive immunity from civil proceedings for contraventions of the Trade Practices Act (TPA) through conducting business with governments, the High Court of Australia held today. Baxter Healthcare is the Australian arm of a global medical products company. It manufactures various sterile fluids for hospitals and fluids and apparatus for home-based kidney dialysis patients. Baxter has the only Australian manufacturing plant for certain types of sterile fluids, at Toongabbie in Sydney. Between 1998 and 2001, Baxter entered into long-term contracts to supply sterile fluids and dialysis products to public hospitals in four States and the ACT. Baxter offered to supply products either priced on an item-by-item basis or heavily discounted by bundling together on a sole-supplier basis. The resulting contracts provided for the total supply of certain sterile fluids and at least 90 per cent of dialysis fluids for up to five years. None of the contracts is still on foot. In 2000, the South Australian Department of Human Services sought tenders for various products and Baxter and two other companies responded. Baxter’s Offer 1 was an item-by-item bid for two years, with optional extensions. Offer 2 was a combined bid on an exclusive basis for five years with volume discounts. The Department requested a revised offer for a five-year term for all products, except renal products, with a volume discount. Baxter’s Offer 1A did not include this discount. Both Offer 1A and Offer 1 cost $5,914,291. The bundled Offer 2 cost $4,501,053, which included renal products but was cheaper than Offer 1A. The Department protested and raised concerns about Baxter’s conduct possibly breaching section 46 of the TPA. Offer 1A was not accepted and a different offer from Baxter was later accepted. Section 46 is concerned with misuse of market power and section 47 with exclusive dealing. Section 46 prohibits corporations taking advantage of market power to eliminate or damage a competitor or to deter or prevent competitive conduct. Exclusive dealing in section 47 includes corporations’ supplying goods on condition that the customer will not acquire certain goods from a competitor or refusing to supply goods because the customer has not agreed not to acquire goods from a competitor, if the conduct has the purpose or effect of substantially lessening competition. In the Federal Court of Australia, the ACCC sought declarations that Baxter had committed 20 contraventions of sections 46 and 47, plus monetary penalties and injunctions. Justice James Allsop found that Baxter’s conduct would have contravened section 46 in one respect in relation to Offer 1A in SA and section 47 in a number of respects. The conduct was not in making or giving effect to a contract but occurred before any contract was entered into. However Justice Allsop held that the Act did not apply to this conduct due to the Crown immunity Baxter derived from doing business with the States and dismissed the ACCC’s application. The Full Court dismissed an appeal, but did not decide Baxter’s argument that Justice Allsop was wrong to conclude that, but for immunity, there would have been breaches of sections 46 and 47. The ACCC appealed to the High Court. The High Court, by a 6-1 majority, allowed the appeal. It held that Baxter, in dealing with a government, did not enjoy a general immunity not available to the government if the government itself had carried on a business. Such a conclusion would go beyond what is necessary to protect the legal rights of governments. The Court rejected an argument that the TPA does not prevent the Crown in right of a State or Territory from making any contract it wishes and that the TPA preserves the Crown’s freedom by providing that corporations dealing with the Crown should be free to make any contract unfettered by any constraints. The Court held that this argument was not supported by established principles of statutory construction and could not be reconciled with the purpose and subject matter of the TPA. It held that in its dealings with the States and Territories, Baxter was bound by sections 46 and 47. Conduct found to have fallen within the prohibitions of sections 46 and 47 should now be subject to remedies, including pecuniary penalties, sought by the ACCC. The Court remitted the case to the Full Court of the Federal Court for further consideration of remaining issues, including whether Baxter’s conduct contravened sections 46 and 47.

HIGH COURT OF AUSTRALIA 16 October 2019 THE QUEEN v A2; THE QUEEN v MAGENNIS; THE QUEEN v VAZIRI [2019] HCA 35 Today the High Court allowed three appeals from the New South Wales Court of Criminal Appeal ("the CCA"). A majority of the Court construed the term "otherwise mutilates" in s 45(1)(a) of the Crimes Act 1900 (NSW), headed "[p]rohibition of female genital mutilation", as bearing an extended meaning that takes account of the context of female genital mutilation. A majority of the Court also held that the term "clitoris" in s 45(1)(a) encompasses the clitoral hood or prepuce. Section 45(1)(a) of the Crimes Act relevantly provides that a person who "excises, infibulates or otherwise mutilates the whole or any part of the labia majora or labia minora or clitoris of any person" is liable to imprisonment. A2 and Magennis were charged upon indictment with having "mutilated the clitoris" of each of the complainants, C1 and C2. Vaziri was charged with assisting A2 and Magennis following the commission of those offences. The Crown case was that A2 and Magennis were parties to a joint criminal enterprise to perform a ceremony called "khatna", which involves causing injury to a young girl's clitoris by cutting or nicking it. The defence case was that Magennis had performed a procedure on C1 and C2, but that it was merely ritualistic. The trial judge in the Supreme Court of New South Wales directed the jury that "[t]he word 'mutilate' in the context of female genital mutilation means to injure to any extent", and that the term "clitoris ... includes the clitoral hood or prepuce". A2 and Magennis were each found guilty by the jury of two counts of female genital mutilation contrary to s 45(1)(a). Vaziri was found guilty of two accounts of being an accessory to those offences. The CCA allowed the appeals against conviction on the ground that the trial judge had erred in his directions to the jury as to the meaning of the terms "otherwise mutilates" and "clitoris" in s 45(1)(a). The CCA concluded that the word "mutilates" should be given its ordinary meaning for the purposes of s 45(1)(a); it requires some imperfection or irreparable damage to have been caused. The CCA further held that the term "clitoris" does not include the clitoral hood or prepuce. The CCA allowed the appeals on various other grounds, including that the jury's verdict was unreasonable or unsupported by the evidence. By grant of special leave, the Crown appealed to the High Court. A majority of the Court held that the term "otherwise mutilates" in s 45(1)(a) does not bear its ordinary meaning, but has an extended meaning that takes account of the context of female genital mutilation, and which encompasses the cutting or nicking of the clitoris of a female child. The purpose of s 45, evident from the heading to the provision and the extrinsic materials, is to criminalise the practice of female genital mutilation in its various forms. A majority of the Court also held that the term "clitoris" in s 45(1)(a) is to be construed broadly, having regard to the context and purpose of s 45. It followed that the trial judge did not misdirect the jury as to the meaning of either of these terms. A majority of the Court allowed the appeals, and held that each matter should be remitted to the CCA for determination of the ground alleging that the jury's verdict was unreasonable or unsupported by the evidence, in light of the proper construction of s 45(1)(a).

HIGH COURT OF AUSTRALIA 7 December 2005 The High Court of Australia today dismissed an appeal against convictions for sexual offences. MWJ was charged with several offences of sexual misconduct involving his partner’s daughter, M, when she was aged between eight and 13. The offences were alleged to have occurred at two different addresses where the family lived in Whyalla in South Australia, first at Sutcliffe Street in Whyalla Stuart, then at Jeffries Street in Whyalla Playford. MWJ met M’s mother, D, in 1987 and moved in with her at Sutcliffe Street. The family, including M and two siblings, moved in 1991 to Jeffries Street. By the time of MWJ’s trial, by judge alone, M was 25. MWJ was convicted at trial by a judge sitting without a jury. The South Australian Court of Criminal Appeal upheld the convictions. The argument for MWJ was based largely on supposed inconsistencies between the evidence of M and her mother. Upholding the decision of the trial judge and the Court of Criminal Appeal, although disagreeing with some observations made by the Court of Criminal Appeal about the conduct of the trial, the High Court held that the supposed inconsistencies were not such as to cast doubt on the outcome of the trial or on the guilt of MWJ. The Court unanimously dismissed the appeal.

HIGH COURT OF AUSTRALIA Public Information Officer 28 September 2006 AUSTRALIAN BROADCASTING CORPORATION v JAMES RYAN O’NEILL The High Court of Australia today lifted an injunction on the broadcasting by the ABC of a documentary about Mr O’Neill, entitled “The Fisherman”. In November 1975, Mr O’Neill was convicted of the murder in Tasmania in February 1975 of a nine-year-old boy. In May 1975, he signed a confession to the murder of another boy, also aged nine, a month before. After his conviction for the first murder and sentencing to life imprisonment, Tasmanian prosecutors decided not to proceed with charges in relation to the April 1975 murder. The documentary alleges Mr O’Neill is linked with the disappearance of a number of other children, including the Beaumont children – Jane, aged nine, Arnna, aged seven, and Grant, aged four – at or near Glenelg beach in Adelaide on Australia Day 1966. Allegations that Mr O’Neill had murdered other children were widely reported by Tasmanian media. Former Victorian detective Gordon Davie and Roar Film Pty Ltd produced “The Fisherman”, which the ABC was to screen on 28 April 2005. On 15 April 2005, Mr O’Neill commenced action for defamation against the ABC, Mr Davie and Roar Film following the showing of the film at the Hobart Summer Film Festival in January 2005. He also applied for an interlocutory injunction against the ABC to prevent the televising of the documentary pending the defamation trial. In the Tasmanian Supreme Court, Justice Ewan Crawford granted the application. The ABC conceded the film was capable of conveying imputations that Mr O’Neill is a suspect in the disappearance and murder of the Beaumont children and that he is a multiple killer of children. Tasmania’s new Defamation Act took effect on 1 January 2006, but the 1957 Defamation Act applied to the proceedings for the injunction. The ABC relied on the statutory defence that the film was both true and for the public benefit. Justice Crawford accepted that the ABC could probably show the imputations were true but held that it would be difficult to establish that publication was for the public benefit. The Full Court of the Supreme Court, by majority, dismissed an appeal by the ABC. The ABC appealed to the High Court. The Court, by a 4-2 majority, allowed the appeal. The majority held there was a strong case against the granting of the interlocutory injunction. It held that Justice Crawford and the Full Court majority erred by failing to give enough weight to the significance of free speech in considering prior restraint of publication and to the consideration that only nominal damages may be awarded if the showing of “The Fisherman” were found to be defamatory.

HIGH COURT OF AUSTRALIA 17 October 2018 IAN DOUGLAS JOHNSON v THE QUEEN [2018] HCA 48 Today the High Court unanimously dismissed an appeal from the Court of Criminal Appeal of the Supreme Court of South Australia, which had dismissed the appellant's appeal against three convictions for sexual offences. At a trial before a jury, the appellant was convicted of five counts of historical sexual offences against the complainant, his sister. Count one charged an indecent assault that occurred when the appellant was aged 11 or 12 and hence presumed to be doli incapax. Count two charged an offence of carnal knowledge that occurred when he was aged 17. The other counts charged offences that occurred when he was an adult and comprised a count of persistent sexual exploitation and two counts of rape. At trial, to rebut the presumption of doli incapax and to show the relationship between the appellant and the complainant, the Crown relied upon evidence from the complainant of the appellant's other alleged sexual misconduct against her, including an incident referred to as "the bath incident" that allegedly occurred when the appellant was aged around six, and two later incidents that allegedly occurred before the first offence. The District Court of South Australia had earlier dismissed the appellant's applications to have counts one and two tried separately and to prevent the Crown from leading certain discreditable conduct evidence, including evidence of these alleged incidents. The appellant appealed against his convictions. The Court of Criminal Appeal quashed the verdicts on counts one and three and substituted verdicts of acquittal on those counts but rejected the contention that the joinder of those counts had occasioned a miscarriage of justice in the trial of the remaining counts. Evidence adduced in relation to counts one and three was admissible on the trial of each remaining count as context evidence of the appellant's relationship with the complainant. By grant of special leave, the appellant appealed to the High Court. The High Court unanimously found that the whole of the evidence of the appellant's other alleged sexual misconduct against the complainant (except evidence of the bath incident) was admissible on the trial of each of the remaining counts: that evidence was relevant to understanding the highly dysfunctional family in which the complainant and appellant were raised. Without understanding this background, the complainant's evidence of the offences charged in the remaining counts was likely to have presented as implausible. The probative value of this evidence substantially outweighed any prejudicial effect on the appellant. While evidence of the bath incident should not have been adduced, its wrongful admission did not lead to a miscarriage of justice: the trial judge gave the jury directions that were apt to neutralise any suggestion that the bath incident cast light on the relationship between the appellant and the complainant, and evidence of the incident was almost certainly subsumed by evidence of the appellant's sexualised childhood misconduct. The judge correctly directed the jury about the limited permitted use of the evidence of the other sexual misconduct to the consideration of each of the remaining counts. There was no basis for inferring that the jury failed to act on those directions. For these reasons, the Court dismissed the appeal.

HIGH COURT OF AUSTRALIA 6 February 2006 Public Information Officer Northern Territory courts had not erred in deciding that a convicted murderer and rapist could be kept in prison for life without any chance of parole, the High Court of Australia held today. On 20 June 1983, Mr Leach, armed with a knife, abducted two young women, aged 18 and 15, from a swimming pool and forced them to accompany him to a nearby gully. He cut off their clothing and used it to bind and gag the 15-year-old. Mr Leach stabbed the 18-year-old and, with the knife in her, bound and gagged and raped her. He stabbed and killed the younger woman. He stabbed the older woman again and left her fatally wounded. Mr Leach, who had already served a prison term for raping a woman at knifepoint in her home, was convicted of two offences of murder and one of rape. At the time, the mandatory sentence for murder was imprisonment for life. He was also sentenced for life for the rape of the 18-year-old. The NT Sentencing (Crime of Murder) and Parole Reform Act came into effect on 11 February 2004. It provided for the fixing of non-parole periods for life sentences for murder imposed after that date. For people already serving life sentences, section 18 provides that the prisoner’s sentence is taken to include a non-parole period of 20 years, or 25 years if the prisoner was serving sentences for two or more murder convictions. However, the Supreme Court may, on application by the Director of Public Prosecutions, revoke the non-parole period and either fix a longer non-parole period under section 19(4) or refuse to fix a non-parole period under section 19(5). The Court may refuse to fix a non-parole period if satisfied that the level of culpability in the commission of the offence is so extreme the community interest in retribution, punishment, protection and deterrence can only be met if the offender is imprisoned for the term of his or her natural life without the possibility of release on parole. On 2 March 2004, the DPP applied under section 19 for the Supreme Court to revoke the non-parole period fixed by section 18 and to take one of the options in section 19(4) or (5). Chief Justice Brian Martin made an order revoking the 25-year non-parole period for the two murder convictions and refused to fix a non-parole period. The majority of the Court of Criminal Appeal upheld that order. Justice Stephen Southwood would have fixed a non-parole period of 40 years which would have meant that Mr Leach could be considered for parole at age 64. Mr Leach appealed to the High Court, arguing that Chief Justice Martin failed to give effect to ordinary sentencing considerations when applying section 19(5), and that he had not shown he was satisfied beyond reasonable doubt that Mr Leach’s culpability was so extreme as to require a sentence of life imprisonment without possibility of parole. The High Court unanimously dismissed the appeal. It held that section 19(5) of the Act is not to be read as requiring a court to consider the exercise of some separate discretion after it has reached a conclusion that the prisoner’s culpability was so extreme that the community interest could only be met by life imprisonment. The word “may” in “may refuse to fix a non-parole period” confers a power to be exercised upon the court being satisfied of the matters described in section 19(5). Any disputed question of fact adverse to the prisoner are to be made to the criminal standard of proof (beyond reasonable doubt), but once the relevant facts are found a judgment would then remain to be made about the level of culpability and what the community interest required.

HIGH COURT OF AUSTRALIA 5 October 2011 SHOALHAVEN CITY COUNCIL v FIREDAM CIVIL ENGINEERING PTY LIMITED [2011] HCA 38 Today the High Court held that an expert's determination of issues in dispute between parties to a construction contract was made in accordance with the contract. The High Court allowed an appeal from the Court of Appeal of the Supreme Court of New South Wales which had held that the expert's determination was not binding on the parties because it was internally inconsistent. Firedam Civil Engineering Pty Ltd ("Firedam") agreed to design and construct a waste water collection and transport system for Shoalhaven City Council ("Shoalhaven"). Under the contract, Firedam claimed an entitlement to variations and payment for additional works, extensions of time for those works and contractual compensation for the extended time. Shoalhaven claimed an entitlement to costs incurred from delayed completion. An expert was appointed under the contract to determine these issues. Under the contract, the parties were required to treat the expert determination as final and binding if the aggregate liability of one party to the other did not exceed $500,000. Where the aggregate liability exceeded $500,000, either party could commence proceedings. In the determination, the expert refused to allow certain extensions of time claimed by Firedam arising from variations to works. Firedam argued that this was inconsistent with the expert's use of a discretion conferred on Shoalhaven in the contract to extend the time for the works to be completed. The expert had used Shoalhaven's discretion to assess Shoalhaven's claim for compensation for Firedam's delays to allocate responsibility for delays between Shoalhaven and Firedam. The primary judge dismissed Firedam's claim to a declaration in the Supreme Court of New South Wales that the expert's determination did not bind the parties. The Court of Appeal disagreed. Shoalhaven appealed to the High Court by special leave. The High Court held that the expert had adequately explained that he had used Shoalhaven's discretion to extend time as a device to allocate responsibility for delay caused by Shoalhaven. The Court held that that was not inconsistent with the expert's refusal to allow Firedam's claimed extensions of time. The High Court therefore held that the Court of Appeal erred and reinstated the orders of the primary judge.

HIGH COURT OF AUSTRALIA 7 April 2005 DANIEL WILKIE v GORDIAN RUNOFF LIMITED (formerly known as GIO INSURANCE LIMITED) AND MARKEL SYNDICATE 702 AT LLOYDS, LONDON (formerly known as RE BROWN SYNDICATE AT LLOYDS, LONDON) Mr Wilkie, FAI Insurance’s former chief operating officer, was entitled to indemnity under an insurance policy for his defence costs in criminal proceedings, the High Court of Australia held today. Directors, officers and employees of FAI were insured for up to $20 million against certain losses, including for wrongful acts committed or allegedly committed up to 31 May 1999. In 2003, the Australian Securities and Investments Commission instituted criminal proceedings against Mr Wilkie for alleged offences under the Corporations Act. ASIC alleged that in 1998 he permitted misleading information to be provided to FAI’s auditors and acted dishonestly in the discharge of his duties with the intention of deceiving the auditors. Mr Wilkie has not admitted the offences and they have yet to be adjudicated. He claimed for the costs to be incurred in his defence against the ASIC charges. The policy contained terms called extensions and Extension 9, on which Mr Wilkie relied, was headed “Advance payment of defence costs”. After GIO’s solicitors reviewed the brief of evidence GIO denied indemnity for the claim pursuant to Exclusion 7 of the policy. Exclusion 7 provides that the policy does not insure loss arising out of any claim based upon dishonest, fraudulent, criminal or malicious acts or omissions or any deliberate breach of any statute where such act, omission or breach has in fact occurred. “In fact” was defined as meaning that the conduct is admitted by the insured person or is subsequently established by a court. Under Extension 9, GIO paid all reasonable defence costs provided that GIO has not denied indemnity for the claim, but it reserved the right to recover payments if a court established that the insured person was not entitled to indemnity. In the New South Wales Supreme Court Mr Wilkie sought a declaration that the insurers were not entitled to rely on Exclusion 7 to deny him indemnity under Extension 9. Justice Henric Nicholas held that insurers were not obliged to indemnify Mr Wilkie. The High Court granted special leave to appeal directly from Justice Nicholas’s decision. The Court held that GIO was responsible for the costs, charges or expenses incurred in defending, investigating or monitoring the ASIC proceedings and related appeals. It held that there is as yet no ground to which GIO can point as a legal basis for a denial of indemnity. Therefore, GIO was not free of an obligation to indemnify Mr Wilkie under Extension 9, on a basis located in Exclusion 7. The Court unanimously allowed the appeal.

HIGH COURT OF AUSTRALIA Public Information Officer 24 April 2008 ALINTA LGA LIMITED (formerly the Australian Gas Light Company) and ALINTA AGN LIMITED (formerly AGL Gas Networks Limited) v MINE SUBSIDENCE BOARD Alinta had no right of appeal to the Land and Environment Court (LEC) against the refusal of the NSW Mine Subsidence Board to entertain its claim to compensation for mine subsidence, the High Court of Australia held today. Alinta owns the natural gas pipeline running from Wilton, south of Sydney, to Horsley Park, in Sydney’s west. The pipeline passes through the Appin Mine Subsidence District, south of Sydney. Alinta alleged that coal mining between May 1998 and July 2003 caused subsidence that required works costing almost $2.4 million to prevent damage to the pipeline. The Mine Subsidence Compensation Act established a scheme whereby claims could be made to the Board for payment of compensation from a statutory fund for damage caused by subsidence or the expense of preventing or mitigating such damage. Alinta made a claim to the Board in September 2004 for costs incurred to protect the pipeline. The Board rejected the claim in 2005. Under the Act, erecting any “improvement” (including a pipeline) in a subsidence district without Board approval was an offence. In the event of a contravention, the Act provided that the Board could not entertain a compensation claim unless a certificate was issued under section 15B(3A). Certificates could be granted if the Board was satisfied that an improvement would have complied with the Act had approval been obtained earlier, and that it was appropriate to issue the certificate. Alinta applied for a certificate under section 15B(3A) in April 2003. In July 2005, the Board advised Alinta that the certificate was refused because of Alinta’s failure to obtain approval for the pipeline at the time of construction (around 1975), delay in applying for certification, and the Board’s belief that issue of a certificate would allow a compensation claim to be entertained. In October 2005, the Board advised Alinta that, without a certificate, Alinta’s claim to compensation could not be entertained. Alinta sought to appeal to the LEC under section 12B of the Act. This provided a right of appeal to the LEC on a compensation claim under sections 12 or 12A against the Board’s decision as to whether damage had arisen from subsidence or could reasonably have been anticipated or as to the amount of payment from the fund. The Board argued that the LEC lacked jurisdiction to hear the appeal as the Board’s decision to refuse to entertain the claim was not a decision under sections 12 or 12A nor a decision as to the matters in section 12B. Justice Peter Biscoe held that the LEC did have jurisdiction. On appeal by the Board, the Court of Appeal, by majority, held that it did not. Alinta appealed to the High Court. This appeal did not concern the merits of Alinta’s compensation claim or the correctness of the Board’s decision. Alinta has never conceded that its pipeline was constructed without the Board’s approval. However, the sole question for the High Court was whether the LEC had jurisdiction to hear Alinta’s appeal under section 12B. The High Court unanimously dismissed the appeal. It held that the right of appeal to the LEC was restricted to appeals against decisions of the Board as to the subject matter in section 12B. The Court rejected Alinta’s submission that the Board had made an appealable decision under section 12B as to the amount of payment from the fund. No such decision had been made. Rather, the Board had found the pipeline to be erected without its approval and applied the statutory requirement that no claim be entertained in the absence of a certificate. It followed that Alinta had no right of appeal against the Board’s decision to the LEC.

HIGH COURT OF AUSTRALIA Manager, Public Information 16 June 2010 WICKS v STATE RAIL AUTHORITY OF NEW SOUTH WALES KNOWN AS STATE RAIL; SHEEHAN v STATE RAIL AUTHORITY OF NEW SOUTH WALES KNOWN AS STATE RAIL [2010] HCA 22 The High Court today held that two policemen, who, in 2003, attended the scene of the Waterfall train crash after the derailment had occurred, were not barred from claiming damages for psychiatric injury on the basis that they had not "witnessed, at the scene, victims being killed, injured or put in peril" within the meaning of s 30(2)(a) of the Civil Liability Act 2002 (NSW). On 31 January 2003 the appellants, who were serving members of the New South Wales Police Force, attended the scene of the Waterfall train crash. They were among the first to arrive at the scene, soon after the accident had happened, and were directly involved in the rescue operation. They saw injured and deceased passengers. The appellants each brought a claim in the Supreme Court of New South Wales for damages for resulting psychiatric injury against the State Rail Authority of New South Wales ("State Rail"). They alleged that they had suffered psychiatric injuries due to State Rail's negligence. That negligence was said to be State Rail's failure to ensure that the train's "deadman's" safety device was operating, or was designed to operate, in the event of a driver's incapacitation. Section 30(2)(a) of the Civil Liability Act provides that a plaintiff is not entitled to recover damages for pure mental harm unless "the plaintiff witnessed, at the scene, the victim being killed, injured or put in peril". Both the trial judge and the Court of Appeal concluded that neither appellant had witnessed a victim or victims of the derailment "being killed, injured or put in peril". The appellants were granted special leave to appeal to the High Court on 12 February 2010. The Court held that the trial judge should have begun his consideration by asking whether State Rail owed a duty to each appellant to take reasonable care not to cause him psychiatric injury. Assuming, without deciding, that State Rail owed the appellants a relevant duty of care, the Court went on to consider whether the condition in s 30(2)(a) of the Civil Liability Act was satisfied. The Court held that it would not be right to read s 30(2)(a) as though it were based on the assumption that all cases of death, injury or being put in peril are events that begin and end in an instant. There are cases where death, or injury, or being put in peril takes place over an extended period, and this was such a case. Two inferences could reasonably be drawn from the given facts: the first was that some who suffered physical trauma in the derailment suffered further injury as they were removed from the wrecked carriages; the second was that many who were on the train suffered psychiatric injuries as a result of what happened to them in the derailment and at the scene. They continued to suffer such injuries after the appellants arrived. The Court held that if either of those inferences was drawn, the appellants witnessed, at the scene, victims of the accident "being injured". Even if neither of those inferences could be drawn, the appellants nevertheless arrived at the scene of the accident when those who had survived the derailment remained in peril. The plaintiffs therefore witnessed, at the scene, victims being "injured" or "put in peril". The Court allowed each appeal and remitted each matter to the Court of Appeal for consideration of whether State Rail owed the appellants a relevant duty of care and whether the appellants suffered a recognised psychiatric injury of which the negligence of State Rail was a cause.

HIGH COURT OF AUSTRALIA 26 May 2010 Manager, Public Information JOHN ALEXANDER'S CLUBS PTY LIMITED & ANOR v WHITE CITY TENNIS CLUB LIMITED WALKER CORPORATION PTY LIMITED v WHITE CITY TENNIS CLUB LIMITED & ORS [2010] HCA 19 White City Tennis Club Ltd ("the Club") operated a sporting club on land in Paddington, Sydney, that was part of a larger site owned by Tennis NSW. In 2004, Tennis NSW decided to sell the site. The Club signed a memorandum of understanding ("the MOU") with John Alexander's Clubs Pty Ltd ("JACS") that contemplated the acquisition by JACS of an option over the land on which the Club currently operated ("the Option Land"). The option was to be exercised on behalf of a yet-to- be-formed entity called White City Holdings ("WCH"), which, in the event, was never formed. JACS undertook to procure a further option for the Club in the event that JACS did not exercise the option itself. If no further option could be procured, the Club could require JACS to exercise the option on the Club's behalf. The MOU was premised on a third party (the Trustees of the Sydney Grammar School ("SGS")) purchasing the land being offered for sale by Tennis NSW. SGS was successful in purchasing the land from Tennis NSW. It then entered into a series of agreements with JACS, the Club and another tennis club under which JACS (or its nominee) was granted an option to acquire the Option Land. The last of these ("the Agreement") provided that JACS and the Club agreed that the MOU continued but that the Agreement would prevail in the event of any inconsistency. The Agreement contained no condition that the option granted under it to JACS (or its nominee) be exercised on behalf of the Club or WCH. On 12 April 2006, JACS purported to terminate the MOU on the basis that the Club had repudiated it, a suggestion that the Club denied. On 27 June 2007, Poplar Holdings Pty Ltd ("Poplar") exercised the option as JACS's nominee and became the registered proprietor of the land. Walker Corporation Pty Ltd ("Walker") financed Poplar's purchase; an unregistered mortgage over the Option Land and a floating charge over Poplar's assets were granted in its favour as security. On the same day that Poplar exercised the option, the Club commenced proceedings in the Supreme Court of NSW against both JACS and Poplar, alleging that the MOU gave rise to a fiduciary duty on the part of JACS to exercise the option solely on behalf of the Club and that JACS had breached that duty. It argued that Poplar held its interest in the Option Land on a constructive trust for the Club. The Club made other allegations of equitable fraud, unconscionability and breach of the Trade Practices Act 1974 (Cth). The trial judge dismissed the proceedings, but on appeal to the NSW Court of Appeal the Club was successful. That Court decided that Poplar held its interest in the Option Land on a constructive trust for the Club, that it would be unconscionable for Poplar to deny the Club any entitlement to an interest in the Option Land and that the MOU gave rise to a fiduciary relationship between JACS and the Club. The Court of Appeal ordered Poplar to transfer the Option Land to the Club upon the Club paying the price at which Poplar exercised the option. After the decision of the Court of Appeal, Walker applied to be joined as a party to the appeal and sought an order that the Court of Appeal's declaration of a constructive trust over the Option Land be set aside or, in the alternative, that it be without prejudice to Walker's interests. The Court of Appeal refused Walker's applications. JACS, Poplar and Walker were granted special leave to appeal to the High Court on 3 November 2009. In a unanimous decision, the High Court decided that Poplar's exercise of the option granted under the Agreement did not amount to equitable fraud, unconscionable conduct or breach of fiduciary duty. The Court held that JACS was under no obligation to exercise the option granted under the Agreement on behalf of the Club, and that Poplar does not hold the Option Land on constructive trust for the Club. In rejecting the Club's assertion of a fiduciary relationship between it and JACS, the Court considered that there was no more vulnerability or reliance by the Club with respect to JACS than that between ordinary contracting parties. Nor were there any other factors justifying a finding that a fiduciary relationship existed between the Club and JACS. The Court also held that the Court of Appeal should have borne in mind the impact that a declaration of constructive trust over the Option Land would have on Walker's interests. It should have set aside its declaration of constructive trust and ordered that Walker be joined as a party to the appeal. The High Court allowed the appeal by JACS from the Court of Appeal's first decision, which had the effect of setting aside the orders Walker sought to have set aside. As a result, the High Court dismissed Walker's appeal from the Court of Appeal's second decision declining to join Walker as a party to the appeal or to set aside the imposition of a constructive trust.

HIGH COURT OF AUSTRALIA Public Information Officer 31 August 2006 CENTRAL BAYSIDE GENERAL PRACTICE ASSOCIATION LIMITED v COMMISSIONER OF STATE REVENUE Central Bayside General Practice is entitled to a payroll tax exemption because it met the definition of a charity, the High Court of Australia held today. Central Bayside was registered as a company limited by guarantee in 1994. Its constitution provided that the company must not distribute any of its profit, income or assets directly or indirectly to its members and it income, assets and profit could only be used for the objective of improving patient care and health in Melbourne’s bayside area. In 2002 Central Bayside had 180 local GPs as primary members and 70 GPs from outside the area as associate members. In the 2001-02 financial year, Central Bayside had total revenue of $1,048,979, of which $1,006,997 came from the Commonwealth. Of the Commonwealth funding, 45 per cent was an outcomes- based funding (OBF) grant while the rest was as grants for particular projects. Central Bayside was required to devise a strategic plan and business plans identifying relevant outcomes for the OBF Agreement. In December 2001, the State Revenue Office refused Central Bayside a payroll tax exemption under section 10(1)(bb) of Victoria’s Pay-roll Tax Act, because Central Bayside was predominantly a professional body promoting the interests of its members. A delegate for the Commissioner, the Victorian Civil and Administrative Tribunal, the Victorian Supreme Court and, by majority, the Court of Appeal upheld that refusal because Central Bayside was not accepted to be a charitable body. The Tribunal accepted that Central Bayside existed for purposes beneficial to the community but held that its services were not charitable as it was an arm of government or the bureaucracy. Central Bayside appealed to the High Court. The Court unanimously allowed the appeal. It held that Central Bayside’s constitution and purposes brought it within the legal definition of a charity. The Commissioner contended that Central Bayside acted so much under the control and influence of government that it could be seen to be furthering government objectives rather than performing its own. The Court held that Central Bayside, like many charities, has a purpose shared by the Commonwealth, in this case to improve patient care and health. This did not alter its essential character as a charity. The Court held that Central Bayside’s purpose is charitable, within the legal meaning of that term, even though the government is the source of its funds and even though Central Bayside consents to conditions being attached to those funds.

HIGH COURT OF AUSTRALIA Public Information Officer 23 April 2008 VINCENT THOMAS O’DONOGHUE v IRELAND AND GRAHAM NEIL CALDER CHARLES ZENTAI v REPUBLIC OF HUNGARY, STEVEN HEATH, MAGISTRATES COURT OF WESTERN AUSTRALIA AND COMMONWEALTH OF AUSTRALIA LARRY RICHARD WILLIAMS v UNITED STATES OF AMERICA AND MAGISTRATES APPOINTED BY COMMISSION UNDER THE PUBLIC SEAL OF NEW SOUTH WALES Commonwealth laws conferring jurisdiction on State magistrates in relation to extradition applications were valid, the High Court of Australia held today. Ireland has sought the extradition of Mr O’Donoghue on fraud charges, Hungary has sought the extradition of Mr Zentai in relation to his alleged involvement in the murder of a Jewish teenager in Budapest in 1944, and the United States has sought the extradition of Mr Williams on tax charges. In each case, pursuant to section 19 of the Extradition Act, they were brought before a magistrate to determine their eligibility for surrender in relation to the extradition offences. Section 46 of the Act provides that the Governor-General may arrange with the Governor of a State for the performance by magistrates of functions under the Act. All three men asserted that section 19 of the Extradition Act was invalid because it involved a constitutionally impermissible attempt by the Commonwealth Parliament to impose a duty upon magistrates as holders of a State statutory office. They argued that Commonwealth Parliament lacked the power, without State legislative approval, to impose upon the holder of a State statutory office an enforceable administrative duty where the functions and incidents of that office were exhaustively defined by State legislation. They all applied to the Federal Court of Australia to restrain the further pursuit of extradition proceedings by Western Australian magistrates, in the cases of Mr O’Donoghue and Mr Zentai, and by New South Wales magistrates, in the case of Mr Williams. Mr O’Donoghue and Mr Zentai had their applications dismissed and they lost appeals to the Full Court of the Federal Court. They appealed to the High Court. Mr Williams’s application was dismissed by the Full Court of the Federal Court in its original jurisdiction. His application for special leave to appeal to the High Court was heard with the two appeals. The High Court, by a 6-1 majority, dismissed the appeals. The application for special leave to appeal was granted, and the appeal treated as heard immediately but dismissed. The Court held that section 19 of the Extradition Act was valid. Section 19 did not impose a duty on State magistrates. It conferred a power which, under the Crimes Act, the State magistrates were not obliged to accept.

HIGH COURT OF AUSTRALIA Public Information Officer 12 December, 2002 MEMBERS OF THE YORTA YORTA ABORIGINAL COMMUNITY v VICTORIA & ORS The High Court of Australia has dismissed an appeal by eight members of the Yorta Yorta community against decisions by the Federal Court and the Full Court of the Federal Court rejecting their native title claim. The Yorta Yorta claim covered an area in southern New South Wales and northern Victoria bisected by the Murray River. Victoria, New South Wales and South Australia, together with shire councils, water authorities, tourism and recreation bodies, business and industry groups, Telstra, the Murray Darling Basin Commission and dozens of landholders, were respondents to the claim. The case involved interpretation of the definition of native title in the Native Title Act. The Act requires that rights and interests in relation to land and waters are held under traditional laws and customs, that the peoples still have a connection with the land and waters, and that the rights and interests are recognised by the common law of Australia. The High Court, by majority, held that the Yorta Yorta claim failed on all three counts. Justice Howard Olney in the Federal Court found that by 1881 the claimants’ ancestors were no longer in possession of their traditional lands and had ceased to observe traditional laws and customs. The Full Court of the Federal Court upheld Justice Olney’s finding that sometime after 1788 the Yorta Yorta community had lost its character as a traditional Aboriginal community. The High Court, by majority, has upheld the Full Court of the Federal Court’s determination that forebears of the Yorta Yorta claimants had ceased to occupy their lands in accordance with traditional laws and customs and that the claimants had not established that they had continued to acknowledge and observe those laws and customs. Such laws and customs needed to have continued substantially uninterrupted if the definition of native title in the Native Title Act were to be satisfied.

HIGH COURT OF AUSTRALIA Public Information Officer 6 November 2008 RUBEN MAS RIVADAVIA v THE QUEEN On 3 September 2008 the High Court of Australia allowed appeals by two men who had been convicted, in the New South Wales District Court, in June 2004 of conspiracy to import a commercial quantity of ecstasy into Australia. Rafael Cesan and Ruben Mas Rivadavia had been sentenced in March 2005, Mr Cesan to 13 years and six months’ imprisonment and Mr Mas Rivadavia to 11 years’ imprisonment. The High Court allowed the men’s appeals because the trial judge, who had repeatedly fallen asleep during their trial, did not exercise the supervision of the trial required by law. The jury had become distracted and a substantial miscarriage of justice resulted. The Court ordered new trials. Today the High Court published its reasons for allowing the appeals. Mr Cesan and Mr Mas Rivadavia were convicted after a 17-day trial. In 2007 they appealed to the New South Wales Court of Criminal Appeal (CCA) against their convictions and sentences, complaining that the trial judge had been asleep when evidence was being given. The CCA received evidence from friends and relatives as well as from Mr Cesan and Mr Mas Rivadavia themselves describing what occurred at the trial. They described episodes of up to 20 minutes’ sleep, sometimes accompanied by snoring. Periods of sleep became longer as the trial went on. Members of the jury were visibly detracted and, at times, amused. Mr Cesan said the judge’s snoring was disruptive when he was being cross-examined. Prosecutor Geoffrey Bellew SC also swore an affidavit referring to occasions in which the judge appeared to be asleep. Medical evidence showed the judge had been suffering from severe obstructive sleep apnoea. The CCA, by majority, dismissed the appeals on the basis that the judge’s conduct did not result in any demonstrated error, omission or misdirection. No complaint had been made at trial about the judge’s sleep episodes. Mr Cesan and Mr Mas Rivadavia appealed to the High Court on a number of grounds including the contention that there had been a miscarriage of justice and no trial by jury as required by section 80 of the Constitution in relation to indictable offences against laws of the Commonwealth. The Court confined argument initially to the question whether there had been a miscarriage of justice. At the end of that argument, on 3 September 2008, the High Court allowed the appeals, set aside the convictions and ordered retrials. The Court unanimously held that the trial judge had a duty to supervise and control the conduct of the trial. Because the judge was noticeably and repeatedly asleep or inattentive the trial was flawed to such an extent that there was a miscarriage of justice. The CCA could not conclude from the trial transcript alone that each of the accused was guilty beyond reasonable doubt. The High Court held that it could not be said that no substantial miscarriage of justice actually occurred, because the members of the jury were prevented from paying full attention to the evidence and therefore unable to perform their task properly.

HIGH COURT OF AUSTRALIA 24 April 2020 MOORE v SCENIC TOURS PTY LTD [2020] HCA 17 Today the High Court unanimously allowed an appeal from a judgment of the Court of Appeal of the Supreme Court of New South Wales concerning damages for disappointment and distress caused by a breach of consumer guarantees in the Australian Consumer Law ("the ACL"). The High Court held that although s 275 of the ACL picked up and applied s 16 of the Civil Liability Act 2002 (NSW) ("the CLA") to proceedings in federal jurisdiction, s 16(1) of the CLA did not apply to preclude the recovery of damages for disappointment and distress not consequential upon physical or psychiatric injury. The appellant, Mr Moore, booked a holiday cruise tour in Europe for himself and his wife, supplied by the respondent, Scenic Tours Pty Ltd ("Scenic"). The tour was severely disrupted by adverse weather conditions. Representative proceedings were commenced in the Supreme Court of New South Wales against Scenic by Mr Moore on his behalf and that of approximately 1,500 passengers of 13 Scenic cruises. The primary judge held that Scenic had failed to comply with the consumer guarantees in s 60 and s 61(1) and (2) of the ACL. Mr Moore claimed damages in respect of loss suffered by him as a result of Scenic's breaches. The alleged loss included disappointment and distress for breach of a contract to provide a pleasant and relaxed holiday. No physical injury or psychiatric illness was alleged to have resulted from the breach. Section 275 of the ACL provides that where there is a failure to comply with a consumer guarantee that applies to a supply of services and the law of a State or Territory is the proper law of the contract, "that law applies to limit or preclude liability for the failure, and recovery of that liability (if any), in the same way as it applies to limit or preclude liability, and recovery of any liability, for a breach of a term of the contract for the supply of the services". The proper law of the contract between Mr Moore and Scenic was the law of New South Wales ("NSW"), which includes the CLA. Accordingly, if applicable, s 16(1) of the CLA precludes, in relation to personal injury, the awarding of damages for non-economic loss, unless the severity of the non-economic loss is at least 15% of a most extreme case, a threshold not met by Mr Moore's claim. The primary judge awarded Mr Moore damages for disappointment and distress. His Honour held that s 275 of the ACL picks up and applies s 16(1) of the CLA to proceedings in federal jurisdiction and that a claim for damages for disappointment and distress relates to personal injury. His Honour held, however, that s 16 of the CLA has no application to loss suffered outside of NSW, and so Mr Moore's claim for damages for disappointment and distress was unaffected. On appeal, the Court of Appeal upheld the primary judge's conclusions that s 275 picked up and applied s 16 and that the claim related to personal injury. However, the Court of Appeal held that s 16 applies to loss sustained outside of NSW, and therefore precluded Mr Moore's claim for damages of that kind. By grant of special leave, Mr Moore appealed to the High Court. The Court held that s 275 of the ACL picks up and applies s 16 of the CLA. However, the Court further held that loss consisting of disappointment and distress for breach of a contract to provide a pleasurable and relaxing experience, where not consequential upon physical or psychiatric injury, does not relate to personal injury. Section 16 of the CLA therefore did not apply to preclude Mr Moore from recovering damages for loss of that kind. Given this conclusion, the Court found it unnecessary to decide whether s 16 applies to loss suffered outside of NSW.

HIGH COURT OF AUSTRALIA 23 June 2004 KETTERING PTY LTD v NOOSA SHIRE COUNCIL A Queensland developer was entitled to make a claim for compensation for the injurious affection to its property covered by in a town plan, the High Court of Australia held today. Kettering owned 19.8 hectares of land on Noosa Hill in Noosa Shire which it wished to subdivide and develop. In 1991 the shire’s town plan was amended by the inclusion of the Noosa Hill Development Control Plan (DCP). The effect was to constrain the development potential of the land and hence diminish its market value. Kettering claimed compensation of $9.3 million. The company claimed its land could reasonably have been expected to be rezoned and subdivided to allow construction of 73 houses and 132 units. After the DCP was gazetted, the planned development was limited to 24 houses and 75 units. Kettering’s claim was rejected by the council and the company successfully appealed to the Planning and Environment Court. In 2001 the Queensland Court of Appeal upheld the appeal from Noosa Council, determining that under section 3.5(4)(d) of the Local Government (Planning and Environment) Act no compensation was payable to Kettering for the detrimental effect of the DCP. This decision is the subject of the first appeal to the High Court. The Court of Appeal’s orders also precluded Kettering from pursuing an alternative basis for its compensation claim, even though this had not been argued in and considered by the Planning and Environment Court, and was not raised before the Court of Appeal. Noosa Council joined Kettering in seeking a correction of the Court of Appeal’s all-embracing order, but the Court declined to correct its orders. This refusal is the basis of the second appeal to the High Court. The appeals centred on the construction of section 3.5 governing compensation. The Court held that section 3.5(4), listing circumstances where compensation is not payable, did not expressly or impliedly confine compensation to only direct and immediate effects of a DCP. The meaning of section 3.5(1)(a)(i) setting out the right to compensation was not to be construed by reference merely to the exceptions to the right. The Court held that the preferred approach was to identify the extent to which a very expansive right to compensation is reduced by quite specific exceptions. The Court of Appeal held that the exception denying compensation for prohibition on the use of land for particular purposes meant Kettering did not have a claim. But the High Court held that the effect of the DCP was upon the potential for subdivision, not upon the particular use of the land. Houses and units could still be built there, but fewer of them. It held that a right to compensation should be interpreted broadly. The onus was on the council to show that Kettering’s claim fell within an exception and it had not satisfied that onus. The Court unanimously allowed both appeals.

HIGH COURT OF AUSTRALIA Public Information Officer 16 May 2006 MARIA SWEENEY v BOYLAN NOMINEES PTY LIMITED trading as QUIRKS REFRIGERATION Boylan Nominees was not vicariously liable for injuries caused by the substandard maintenance work performed by an independent contractor on its behalf, the High Court of Australia held today. Mrs Sweeney suffered injuries to her head, neck and hand when a door of a refrigerator at a service station fell off and landed on her when she attempted to open it to buy milk. Boylan had leased out the refrigerator and the lease obliged the company to service and maintain the refrigerator. Shortly before the accident, the service station manager had told Boylan that the refrigerator door was not closing properly. Boylan sent a mechanic who tightened the screws in the hinges and showed the manager that the door was now working. The mechanic was not employed by Boylan. He performed work at Boylan’s request then invoiced Boylan for the hours he performed and for spare parts. Boylan did not provide a uniform, tools, equipment or a vehicle. The mechanic’s van carried his own company’s name. In the New South Wales District Court Mrs Sweeney sued both the owners of the service station and the refrigeration company. The claim against the service station owners failed but the claim against Boylan succeeded and Mrs Sweeney was awarded $43,932 plus costs. Judge Christopher Robison held that Boylan was vicariously liable for the negligence of a mechanic it had sent to service the refrigerator in response to the service station’s complaint that the door was not closing properly. Judge Robison concluded that the mechanic was acting as Boylan’s servant or agent. The NSW Court of Appeal allowed an appeal by Boylan. It held that Boylan was not vicariously liable for the mechanic’s negligence. Mrs Sweeney appealed to the High Court, which by a 5-1 majority dismissed the appeal. The Court concluded that the mechanic was an independent contractor and therefore the claim against Boylan must fail. The mechanic was not a Boylan employee and he conducted his own business, invoicing Boylan for each job and supplying his own tools. An employer will generally be vicariously liable for an employee’s negligence but someone engaging an independent contractor will not generally be vicariously liable for the contractor’s negligence.

HIGH COURT OF AUSTRALIA 1 September 2010 SPENCER v COMMONWEALTH OF AUSTRALIA [2010] HCA 28 In 2007 Mr Spencer commenced proceedings in the Federal Court of Australia claiming that certain Commonwealth legislation and intergovernmental agreements had effected an acquisition of his property other than on just terms. Today the High Court held that the case should not have been summarily dismissed under s 31A of the Federal Court of Australia Act 1976 (Cth), as it could not be said that Mr Spencer had "no reasonable prospect" of successfully prosecuting the proceedings. Mr Spencer was the owner of a farm at Shannons Flat, New South Wales, known as "Saarahnlee". The property was subject to the Native Vegetation Act 2003 (NSW) and previously subject to the Native Vegetation Conservation Act 1997 (NSW) ("the State Acts"). Both statutes restricted his ability to clear native vegetation on his land. On 12 June 2007, Mr Spencer commenced proceedings against the Commonwealth of Australia in the Federal Court. He claimed that the restrictions imposed by the State Acts effectively amounted to an acquisition of his interests in the land, in particular his rights to carbon sequestration. He claimed that the acquisition had been on other than just terms and had been made in furtherance of agreements between the Commonwealth and the State of New South Wales. Those agreements established a framework for the management and use of land, including native vegetation clearing, and allocated Commonwealth funds to the State for that purpose. Mr Spencer alleged that the agreements, and the Commonwealth legislation that authorised them – the Natural Resources Management (Financial Assistance) Act 1992 (Cth) and the Natural Heritage Trust of Australia Act 1997 (Cth) ("the Commonwealth Acts") – were invalid to the extent to which they effected or authorised the acquisition of property other than on just terms within the meaning of s 51(xxxi) of the Constitution. At first instance, the Commonwealth applied for summary judgment under s 31A of the Federal Court of Australia Act 1976 (Cth). Section 31A provides that the Court may give judgment for one party against another where "the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding". On 28 August 2008, Justice Emmett made an order dismissing the proceedings on the basis that neither of the Commonwealth Acts could be characterised as a law with respect to the acquisition of property within the meaning of s 51(xxxi). His Honour held that neither of the Commonwealth Acts required or permitted the Commonwealth to impose, as a condition for the grant of financial assistance, a requirement that the State acquire the property other than on just terms. Mr Spencer was granted leave to appeal to the Full Court of the Federal Court but the appeal was dismissed on 24 March 2009. On 12 March 2010, Mr Spencer's application for special leave to appeal to the High Court was referred for hearing before seven Justices of the High Court. Today the High Court held that the case had not been a suitable one for the application of s 31A of the Federal Court of Australia Act. Mr Spencer had argued that the Commonwealth Acts formed part of a scheme or device designed to avoid the restrictions on Commonwealth legislative power found in s 51(xxxi) of the Constitution. The statement of claim referred to arrangements or understandings between the Commonwealth and the State of New South Wales beyond what appeared on the face of the relevant legislation and intergovernmental agreements. The Court noted that, in a case decided after the Full Federal Court's decision in this matter (ICM Agriculture Pty Ltd v The Commonwealth), three members of the High Court expressly left open the question whether a Commonwealth law might be characterised by reference to informal arrangements for the grant of financial assistance as a law with respect to the acquisition of property. Whether there were such arrangements in this case, and whether they were constitutionally significant, was not a question suitable for determination on a summary judgment application. The High Court held that, in light of the decision in ICM, it could not be said that Mr Spencer had "no reasonable prospect of successfully prosecuting the proceeding". The Court granted Mr Spencer special leave to appeal and allowed the appeal with costs.

HIGH COURT OF AUSTRALIA 2 December 2004 JEFFREY GORDON BUTCHER AND JUDITH KAY RADFORD v LACHLAN ELDER REALTY PTY LTD A real estate agent whose brochure for a waterfront property carried a surveyor’s diagram which incorrectly showed the vendor’s swimming pool wholly within the property had not engaged in misleading and deceptive conduct, the High Court of Australia said today. Mr Butcher and Ms Radford in February 1997 successfully bid $1.36 million for the house at Mona Vale on Sydney’s northern beaches. The deposit was $272,000, with $200,000 paid immediately and the rest payable once the couple sold their home in nearby Newport. The contract provided for a six-month completion date. The couple planned to renovate then sell the house as part of a strategy for ensuring their family’s long-term financial security. They planned to move the pool from across the block to sit along one side to open up space for entertaining. Gordon Spring, an employee of Mr Elder, an LJ Hooker franchisee, gave Mr Butcher a double-sided sheet with colour photographs, brief details and a survey diagram. The diagram showed a line marked “MHWM” (mean high-water mark) which was approximately the fence line and also showed a “reclaimed area” between the fence and the water. Disclaimers on each side of the brochure said the information was from reliable sources but could not be guaranteed and buyers should make their own inquiries. The survey report, written in 1980, was attached to a contract sent to Mr Butcher and Ms Radford’s solicitor. Following disclosures by vendor Robert Edward Harkins, a new survey and dealings with Pittwater Council and the Department of Conservation and Land Management, which rejected their plan to move the pool, the couple realised the rear boundary crossed the pool. They commenced an action against Mr Harkins for both fraudulent and innocent misrepresentation and for misleading or deceptive conduct and declined to pay the $72,000 balance of the deposit. In the New South Wales Supreme Court Justice Robert Austin found Mr Harkins made an innocent misrepresentation and engaged in misleading conduct and ordered him to repay the $200,000 deposit. Mr Butcher and Ms Radford sued the agent for misleading and deceptive conduct due to the brochure misrepresenting the boundary location. Justice Austin found the agent was not liable. The Court of Appeal dismissed an appeal against the agent. The couple appealed to the High Court. The Court, by a 3-2 majority, dismissed the appeal. The majority held that the agent did not engage in misleading conduct and did no more than communicate what Mr Harkins was representing, without adopting it or endorsing it. The agent did not hold itself out as being able independently to verify title details. It did not verify the accuracy of the survey diagram, merely stating a belief that sources of information in the brochure were reliable. Mr Butcher and Ms Radford sought advice from an accountant, an architectural designer and a builder as well as solicitors before auction. The disclaimers were significant. Reasonable purchasers would have read the whole document, given its importance, its brevity, and its use as a source of instructions to professional advisers.

HIGH COURT OF AUSTRALIA 7 September 2022 GARLETT v THE STATE OF WESTERN AUSTRALIA & ANOR [2022] HCA 30 Today, the High Court dismissed the part of an appeal pending in the Court of Appeal of the Supreme Court of Western Australia which was removed to the High Court pursuant to s 40 of the Judiciary Act 1903 (Cth). The appeal concerned a challenge to the validity of item 34 of Subdiv 3 of Div 1 of Sch 1 to the High Risk Serious Offenders Act 2020 (WA) ("the HRSO Act") on the basis that it was contrary to Ch III of the Constitution by reason of the principle in Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51. The HRSO Act provides that the State of Western Australia may apply to the Supreme Court of Western Australia for a restriction order in relation to a "serious offender" under custodial sentence for a serious offence, who is not under a restriction order. The Court "must" make a restriction order if satisfied that it is necessary to ensure adequate protection of the community against an unacceptable risk that the offender will commit a serious offence. Item 34 of Subdiv 3 of Div 1 of Sch 1 to the HRSO Act specifies that robbery is a "serious offence" for the purposes of the HRSO Act. A restriction order may be either a supervision order (which subjects the offender, when not in custody, to stated conditions) or a continuing detention order (which detains the offender in custody "for an indefinite term for control, care or treatment"). Mr Garlett was sentenced to three years and six months' imprisonment for offences including robbery. The State applied for a restriction order in relation to Mr Garlett shortly before his release date. The primary judge relevantly declared that none of the provisions of the HRSO Act contravened Ch III of the Constitution, insofar as they apply to a serious offender under a custodial sentence who has been convicted of the offence of robbery. The High Court, by majority, held that item 34 of Subdiv 3 of Div 1 of Sch 1 to the HRSO Act does not contravene Ch III of the Constitution. The HRSO Act establishes a non-punitive scheme that has as its object the protection of the community from harm, and the determination of the risk of future harm posed by an offender is judicial in nature. The circumstance that the Supreme Court is not invested with a residual discretion to decline to make a restriction order does not establish that it is acting upon the dictation of the executive government as to the manner of deciding the case or its outcome. Rather, the Court is required to act upon its own evaluative judgment, by processes characteristic of the exercise of judicial power and with reference to prescribed criteria, to determine whether a restriction order is necessary for the purpose of protecting the community from harm. The inclusion of an offence, such as robbery, as a "serious offence" for the purposes of the HRSO Act reflects a legislative judgment as to the kinds of offences which may be such as to cause harm of a kind from which the community needs protection different from that provided by the criminal law. It is not inimical to the institutional integrity of the Court to act upon a legislative judgment of this kind. The function of the Supreme Court under the HRSO Act is therefore not incompatible with the role of the Court as a repository of the judicial power of the Commonwealth.

HIGH COURT OF AUSTRALIA 30 October 2013 WINGFOOT AUSTRALIA PARTNERS PTY LTD & ANOR v EYUP KOCAK & ORS [2013] HCA 43 Today the High Court unanimously allowed an appeal against a decision of the Court of Appeal of the Supreme Court of Victoria, holding that certiorari was not available to quash an opinion of a Medical Panel made under the Accident Compensation Act 1985 (Vic) ("the Act") where that opinion had no continuing legal consequences. The first respondent ("the Worker") was employed by the appellants ("the Employer") when he suffered an injury at work. The Worker commenced two proceedings relating to that injury: one seeking leave to bring proceedings for common law damages ("the serious injury application") and the other seeking, under the Act, a declaration of entitlement to medical or like expenses ("the statutory compensation application"). The Magistrates' Court of Victoria, which heard the statutory compensation application, referred three medical questions to a Medical Panel for determination under the Act. Upon receiving from the Medical Panel a certificate of the Medical Panel's opinion and written statement of reasons, the Magistrates' Court made orders by consent to "adopt" and "apply" the opinion, and to dismiss the statutory compensation application. The serious injury application subsequently came before the County Court of Victoria. The Employer contended that the County Court was bound by the opinion of the Medical Panel, either because of s 68(4) of the Act, which relevantly provides that the opinion of a Medical Panel be adopted and applied, and accepted as final and conclusive, by a court, or because the orders made by the Magistrates' Court gave rise to an issue estoppel. The Worker then applied to the Supreme Court of Victoria for an order in the nature of certiorari to quash the opinion of the Medical Panel on grounds including that the Medical Panel failed to give adequate reasons for its opinion. The application was dismissed but the Worker successfully appealed to the Court of Appeal. By special leave to appeal, the Employer appealed to the High Court. The High Court unanimously held that inadequacy of reasons is an error of law on the face of the record of an opinion of a Medical Panel for which certiorari will ordinarily be available. An order in the nature of certiorari was not, however, available in the circumstances of this case where the opinion of the Medical Panel had no continuing legal consequences. The Court held that s 68(4) of the Act operated to require that the opinion of the Medical Panel be adopted and applied only in the determination of the question or matter in which the medical question arose and in respect of which the medical question was referred to the Medical Panel, rather than for the purposes of determining some other question or matter. The question or matter which comprised the controversy between the parties to the statutory compensation application was brought to a conclusion when that application was dismissed. The Court also held that the Magistrates' Court's adoption and application of the opinion of the Medical Panel when dismissing the statutory compensation application created no issue estoppel binding the parties in the serious injury application. The Court held further that, in any event, the Medical Panel's reasons explained the actual process of reasoning by which the Medical Panel formed its opinion, in sufficient detail to enable a court to see whether the opinion involved any error of law, and therefore met the standard required by the Administrative Law Act 1978 (Vic).

HIGH COURT OF AUSTRALIA 15 May 2008 Public Information Officer ALAN GRIFFITHS ON BEHALF OF THE NGALIWURRU AND NUNGALI PEOPLES AND WILLIAM GULWIN ON BEHALF OF THE NGALIWURRU AND NUNGALI PEOPLES v MINISTER FOR LANDS, PLANNING AND ENVIRONMENT AND LANDS AND MINING TRIBUNAL The Northern Territory Government had the power to acquire compulsorily land subject to native title, both when there were co-existing non-native title interests in the land and when there were not, provided the acquisition was not discriminatory, the High Court of Australia held today. The Minister issued three notices in 2000 proposing acquisition of interests in land at the town of Timber Creek in the north-west of the NT. Section 43(1) of the NT’s Lands Acquisition Act (LAA) empowered the Minister to compulsorily acquire land “for any purpose whatsoever” by publishing a notice in the Gazette. (The section previously used the term “for public purposes”.) Under the LAA, “land” included native title rights and interests. In 1999, the Ngaliwurru and Nungali peoples began proceedings in the Federal Court of Australia for a determination of native title to vacant Crown land in Timber Creek. The Court made a determination of native title in 2006 and the Full Court of the Federal Court varied the determination in favour of the Ngaliwurru and Nungali peoples last November. No other title existed over the lots the Minister sought to acquire. Proposed uses were goat breeding, hay production and market gardening on one lot, cattle husbandry on a second, and tourism on five more lots. For the first two proposals, a Crown lease would be granted to Warren Pty Ltd, while lots in the third proposal would be offered at a public auction for Crown leases. Upon completion of each development the lease could be exchanged for freehold title. Objections by Mr Griffiths and Mr Gulwin to the proposed acquisitions were heard by the Lands and Mining Tribunal. In 2002, the LMT recommended the compulsory acquisition of native title, subject to the NT’s paying compensation if native title were determined by the Federal Court to have existed prior to acquisition. The Minister accepted the recommendations. Mr Griffiths and Mr Gulwin commenced proceedings in the NT Supreme Court to set aside the recommendations and the decision of the Minister to act upon them. In 2003, Justice David Angel made such orders. The Minister successfully appealed to the NT Court of Appeal in 2004. Mr Griffiths and Mr Gulwin appealed to the High Court to seek reinstatement of Justice Angel’s orders. They argued that, despite the phrase “for any purpose whatsoever”, section 43(1) of the LAA did not confer power on the Minister to acquire land from one person solely to enable it to be sold or leased for private use to another person. They also argued that native title interests may be acquired only when there were co-existing non-native title interests that also were acquired. The High Court, by a 5-2 majority, dismissed the appeal. Following amendments in 1998 to the Commonwealth Native Title Act (NTA) and a 1984 decision by the High Court limiting the meaning of “to acquire land for a public purpose” in earlier federal legislation for the territories, the LAA was amended to remove potential limitations on the NT’s statutory power to acquire land. The NTA provided for an entitlement to compensation when native title rights or interests were extinguished through compulsory acquisition of land. It provided for extinguishment of native title rights and interests where certain conditions designed to avoid racial discrimination were met, including that “all non-native title rights and interests” also be acquired. The majority held that “all” meant any non-native title rights and interests as may exist at the time of acquisition. There was no requirement that there be non-native title interests in the land for the compulsory acquisition of native title interests to be permitted under the NTA. The majority held that the Minister’s power under the LAA to acquire land “for any purpose whatsoever” included acquisition for the purpose of granting a freehold estate or Crown lease pursuant to other NT legislation.

HIGH COURT OF AUSTRALIA 29 September 2005 BARBARA MARY JOSEPHINE NEILSON v OVERSEAS PROJECTS CORPORATION OF VICTORIA AND MERCANTILE INSURANCE (AUSTRALIA) LTD The High Court of Australia today held that a personal injury claim by an Australian individual against an Australian company arising from an accident in China could be determined in Australia by reference to Australian law, by reason of the relevant provisions of the Chinese civil code. Mrs Neilson, now 71, was injured in 1991 when she fell down stairs in an apartment in which she and her husband were living in the Chinese city of Wuhan. Her husband, George Neilson, worked for the Overseas Projects Corporation (OPC), a company owned by the State of Victoria and involved in a joint venture with the Chinese government by which it provided experts to conduct training courses at the China Iron and Steel Training Centre at the Wuhan Iron and Steel University. Mr Neilson taught organisational behaviour and Mrs Neilson was a part-time personal assistant to the Australian director of the training centre. The accident occurred when Mrs Neilson got up during the night to get a glass of water from the kitchen downstairs. The stairwell lacked a balustrade, about which the Neilsons had complained to OPC. As Mrs Neilson reached for the light switch she miscalculated and fell heavily down the stairs, suffering head and back injuries. In 1997, after the Neilsons returned home to Western Australia, Mrs Neilson instituted proceedings in the WA Supreme Court. She sued OPC for damages for injuries suffered as a result of the company’s negligence. Mrs Neilson claimed that the stairs were dangerous and that OPC had breached its duty to take reasonable care for her safety. At the 2002 trial, OPC sought to rely on Chinese law which had a one-year limitation period for personal injury claims. Justice John McKechnie invoked Article 146 of China’s General Principles of Civil Law which provides that in compensation cases, if both parties are foreign nationals from the same country, the law of their own country may be applied. He held that Mrs Neilson’s claim was not statute-barred by Chinese law and held OPC liable and gave judgment for $300,000, a sum agreed by the parties. OPC appealed to the Full Court of the Supreme Court which held that Justice McKechnie was wrong to invoke Article 146 and to apply Australian law. Mrs Neilson appealed to the High Court. Questions of duty, breach and damages are not in issue. The High Court, by a 5-2 majority, allowed the appeal. It held that the Australian rule which directed Justice McKechnie to apply the law of the place where the harm happened did not require him to ignore the fact that Chinese law made special provision for claims for damages where both parties to the claim were nationals of the same foreign country.

HIGH COURT OF AUSTRALIA 8 December 2005 THE STATE OF NEW SOUTH WALES v PETER ANDREW BUJDOSO The State was under a duty to adopt reasonable measures to reduce the risk of harm to a person who was bashed when prison authorities knew he was a likely target of other prisoners, the High Court of Australia held today. Mr Bujdoso pleaded guilty on 16 February 1990 to three counts of sexually assaulting males under 18 and was sentenced to a minimum term of two years and six months’ imprisonment, to expire on 16 August 1992. In September 1991, he was admitted to Silverwater Prison’s work release program, in which he had paid employment and returned to the prison each night. At the time, prisoners were classified as A, B or C, with C the minimum-security category. C1 prisoners were behind a secure fence with minimal supervision, C2 prisoners kept in an open institution, and C3 prisoners permitted to go out on work release and eligible for weekend, day or education leave. In various prisons, a prison farm and at Kirkconnell Afforestation Camp, Mr Budjoso was called a “rock spider” and subjected to threats and an assault. However, by November 1990 he had become a C2. In May 1991, Mr Bujdoso was transferred to Silverwater where he received a threatening letter, of which prison officers were aware. He did not wish to be in protective custody and tried to avoid other paedophiles. Mr Bujdoso applied to be moved to the work release area as he felt he would be safest out at work and would be with other C3 prisoners in four units fenced off from the rest of Silverwater. Prisoners each had a room with their own key. Mr Bujdoso’s room was at the end of a unit furthest from a central walkway and from the administration block. Two prison officers made a nightly head count then one remained to oversee all the units. This meant there were periods with no officers present and other periods with just one. On 21 September 1991, up to four prisoners wearing balaclavas forced their way into Mr Bujdoso’s room and began beating him with iron bars as he huddled in a corner. He lost consciousness. His injuries included a fractured skull. Mr Bujdoso sought to go back to Silverwater so he could continue working to pay his mortgage and to obtain further treatment for paedophilia. He said he realised prison officers did not want to accept responsibility for his safety, but another prisoner made a statement that he had overheard several other men talking about an attack on a “rock spider” and that they planned to give him another “going over”. Mr Bujdoso was returned against his wishes to Kirkconnell where he served out his sentence. He sued the State in the NSW District Court for damages for personal injuries in negligence. Judge Harvey Cooper held that the State had not breached its duty of care as prison authorities believed that work release inmates had proved themselves trustworthy so no special measures were necessary to ensure their safety. Mr Bujdoso successfully appealed to the Court of Appeal, which held that the State did breach the duty of care it owed him, especially when it had actual knowledge that he was at risk but took no steps to protect him. The guard at the units was not even told of the threats against Mr Bujdoso and nothing else was done, not even putting a more secure lock on his door. The State appealed to the High Court. The Court unanimously dismissed the appeal. It held that the State had a duty to adopt reasonable measures to reduce the risk of harm to Mr Bujdoso, who was a known target of other prisoners. The risk of injury to him was not only foreseeable but expressly threatened. The State’s system of classification and the rostering of one warder during the night were inadequate. The Court held that the State had acted in breach of its duty of care.

HIGH COURT OF AUSTRALIA Public Information Officer 30 August 2007 LEMALUOFUIFATU ALIPAPA TOFILAU v THE QUEEN MATTHEW JOSEPH MARKS v THE QUEEN SHANE JOHN HILL v THE QUEEN MALCOLM JOSEPH THOMAS CLARKE v THE QUEEN Confessions to unsolved murders made to Victorian undercover police posing as criminal gangsters were voluntary and admissible as evidence, the High Court of Australia held today. Mr Tofilau was suspected of strangling his ex-girlfriend, Belinda Loree Romeo, in her unit. Mr Marks was suspected to have beaten his great-aunt, Margaret Mary O’Toole, to death after borrowing large sums of money from her. Mr Hill was suspected of killing his stepbrother, Craig Anthony Reynolds, in the house they shared by fracturing his skull with a blunt object. Mr Clarke was suspected of killing six-year-old Bonnie Melissa Clarke (no relation) in 1982. He had been boarding with Bonnie’s mother until three months before. Bonnie had been stabbed in the chest and sexually assaulted. Police had been unable to make a strong enough case against any of the men. In a technique imported from Canada, each of the four Melbourne men was tricked by undercover police posing as criminals into confessing. They were approached by supposed criminal gangs playing out various crime scenarios over several months. Each was told that in order to be a gang member and to profit from the gang’s activities he had to tell the gang boss the truth about his involvement in the murder. Each was told that the boss could make any problems disappear. In Mr Tofilau’s case, typical of all four cases, undercover police staged 16 scenarios in which he participated in or observed what appeared to be serious criminal activity. This was designed to instil confidence that association with the gang would bring financial benefits and protection from police investigation. In March 2002 police served notice on Mr Tofilau that they were applying to the Magistrates Court for permission to take a DNA sample from him. On hearing of this, a gang member exhorted him to tell the truth and Mr Tofilau admitted strangling Ms Romeo. He was taken to a meeting in a hotel room with the gang boss. The boss told him that if he told the truth the boss would make it “go away”. Mr Tofilau described how he had killed Ms Romeo with her scarf which he threw into a car at her unit block. He was arrested the next day and later convicted of murder. In each case the trial judge held that what each man had said to people he believed to be criminal gang members did not constitute a statement to a person in authority. Each trial judge also held that the confession was voluntary. The convictions were upheld by the Court of Appeal. All four men appealed to the High Court which, by a 6-1 majority, dismissed the appeals. The Court held that the confessions of all four were procured by inducements, but that the people holding out the inducements – police officers posing as criminals – were not persons in authority. The men believed they had been offered inducements, not by police, but by gangsters apparently able to influence certain corrupt police officers. The Court held that, although the confessions were obtained by deception, the wills of the appellants were not overborne, there was no duress or intimidation, and the confessions were voluntary. Mr Clarke also argued that the trial judge should have exercised his discretion to exclude the confession for reasons of unreliability, unfairness and public policy. Those arguments were dismissed by both the Court of Appeal and the High Court.

HIGH COURT OF AUSTRALIA Manager, Public Information 22 April 2009 RADIO 2UE SYDNEY PTY LTD v RAY CHESTERTON Today the High Court dismissed Radio 2UE’s appeal in relation to an earlier jury finding that comments made by John Laws about Ray Chesterton on the John Laws Morning Show were defamatory. On 8 August 2005, on his radio program, John Laws made some derogatory comments about Ray Chesterton, a journalist who had previously worked with 2UE. Radio 2UE Sydney Pty Ltd is the licensee of the radio station over which the comments were broadcast. Mr Chesterton sued 2UE for defamation. At the trial before a judge and jury in the Supreme Court of NSW, the jury had to decide whether the comments made by John Laws conveyed certain imputations about Mr Chesterton and, if so, whether those imputations defamed him. The jury decided in Mr Chesterton’s favour on both of those issues. Radio 2UE appealed to the NSW Court of Appeal, arguing that the trial judge had given the members of the jury incorrect directions about how they should decide whether Mr Chesterton had been defamed in respect of his professional or business reputation. The Court of Appeal, by majority, found that the trial judge had given appropriate directions to the jury. 2UE was granted special leave to appeal to the High Court. A majority of justices affirmed that the general test for defamation, namely whether an ordinary reasonable person would think less of the plaintiff because of what was said about him or her, applied to imputations regarding all aspects of a person’s reputation, including business reputation. All members of the High Court considered that the trial judge had given appropriate directions to the jury about how they should approach the task of determining whether Mr Laws’ comments contained certain imputations, and if they did, whether the comments were defamatory. The members of the Court were unanimous in dismissing 2UE’s appeal.

HIGH COURT OF AUSTRALIA 5 September 2006 WILLIAM ARTHUR FORGE, JOZSEF ENDRESZ, DAWN MAY ENDRESZ, ALLAN PAUL ENDRESZ AND BISOYA PTY LTD v AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, THE STATE OF NEW SOUTH WALES AND THE COMMONWEALTH OF AUSTRALIA Public Information Officer The High Court of Australia today rejected a challenge to the appointment of acting judges to the Supreme Court of New South Wales. Mr Forge is the director of Bisoya, his private family company. The Endreszes are husband, wife and son, whose family company is Kamanga Holdings Pty Ltd. They were directors of CTC Resources NL and Mr Forge its managing director. In 1998, eight transactions disbursed more than $3.5 million from CTC to Bisoya and Kamanga in the form of management and consultancy fees and unsecured loans. In 2001, ASIC brought proceedings in the Supreme Court alleging that the transactions contravened the NSW Corporations Law. By the time of the hearing before Justice Michael Foster in 2002, the Corporations Law had been replaced by the Commonwealth Corporations Act. Justice Foster held that the transactions contravened the Corporations Law and imposed penalties. The Court of Appeal dismissed an appeal except for penalty and remitted the issue to the Supreme Court for hearing. That hearing has not taken place because at this point Mr Forge and the Endreszes questioned for the first time the validity of Mr Foster’s appointment. Mr Foster retired from the Federal Court when he reached the statutory retirement age of 70 in 1998. Under a series of commissions pursuant to section 37 of the Supreme Court Act he served as an acting judge of the NSW Supreme Court between 1999 and 2003 when he turned 75, the maximum age for an acting judge. In 2001, the Supreme Court had 45 permanent judges. Twenty people, all retired judges or serving District Court judges, were acting judges or judges of appeal for terms of three to 12 months. Three related proceedings came before the High Court questioning the validity of appointments of judges as acting judges of the Supreme Court under section 37 of the Supreme Court Act and the validity of transitional provisions relating to contravention in the Corporations Act. The first was a constitutional challenge, the second was removal of the penalty issue into the High Court, and the third was an application for special leave to appeal from the Court of Appeal decision. The High Court, by a 6-1 majority, found in favour of ASIC in all three proceedings. It held that the legislation providing for the appointment of acting judges was valid and that none of Mr Foster’s appointments as an acting judge were invalid. In the constitutional challenge, the Court allowed the demurrers (denials of the legal sufficiency of the facts to entitle Mr Forge and the Endreszes to a legal remedy) of ASIC and NSW. It held that the transitional provisions of the Corporations Act are valid and the proceedings before Justice Foster and the Court of Appeal constituted a matter arising under a law made by parliament within the meaning of section 76(ii) of the Constitution in a situation where the original offences arose under a State Act. The application for special leave to appeal was refused.

HIGH COURT OF AUSTRALIA 8 May 2013 ROSEANNE BECKETT v THE STATE OF NEW SOUTH WALES [2013] HCA 17 Today the High Court unanimously allowed an appeal from a decision of the Court of Appeal of the Supreme Court of New South Wales, which had held that Ms Roseanne Beckett's claim for damages for malicious prosecution required proof of her innocence. In September 1991, Ms Beckett was convicted of eight offences against her husband. In August 2005, the New South Wales Court of Criminal Appeal quashed the convictions on six of the counts. The Court entered a verdict of acquittal for one count, and ordered a new trial on the remaining counts. In September 2005, the Director of Public Prosecutions ("the Director") gave a direction, pursuant to s 7(2)(b) of the Director of Public Prosecutions Act 1986 (NSW), that no further proceedings be taken against Ms Beckett on the outstanding counts. In August 2008, Ms Beckett instituted proceedings against the respondent in the Supreme Court of New South Wales, claiming damages for malicious prosecution. Both parties agreed that the Court should answer separate questions regarding whether Ms Beckett needed to prove her innocence to maintain her claim for damages. The trial judge held that the Director's decision not to proceed further with the charges was equivalent to the entry of a nolle prosequi by the Attorney-General. He applied the High Court's decision in Davis v Gell (1924) 35 CLR 275, which held that where proceedings have been terminated by the entry of a nolle prosequi, as distinct from other forms of termination, a plaintiff must prove his or her innocence to succeed in a subsequent action for malicious prosecution. The Court of Appeal affirmed the trial judge's decision. By special leave, Ms Beckett appealed to the High Court. The High Court unanimously allowed the appeal, holding that Davis should not be followed. The Court held that a plaintiff is not required to prove his or her innocence in an action for damages for malicious prosecution in any case in which the prosecution has terminated favourably to the plaintiff.

HIGH COURT OF AUSTRALIA 4 December 2019 STATE OF NEW SOUTH WALES v BRADFORD JAMES ROBINSON [2019] HCA 46 Today the High Court dismissed an appeal from a judgment of the Court of Appeal of the Supreme Court of New South Wales concerning the power of a police officer to arrest a person, without a warrant, under s 99 of the Law Enforcement (Powers and Responsibilities) Act 2002 (NSW) ("the Act") when, at the time of the arrest, the officer had not formed the intention to charge the arrested person with an offence. A majority of the High Court held that s 99 of the Act does not confer a power to arrest a person in such circumstances. An Apprehended Violence Order ("AVO") restrained Mr Robinson from certain conduct. When Mr Robinson voluntarily entered Sydney City Police Station, a constable arrested him and told him he was being arrested for breaching the AVO. The constable had no intention, at the time of the arrest, of bringing Mr Robinson before an authorised officer to be dealt with according to law unless it later emerged that there was sufficient reason to charge him. The constable offered Mr Robinson the opportunity of an interview, which he accepted. At the end of the interview Mr Robinson was released without charge. Mr Robinson brought a claim for damages for wrongful arrest and false imprisonment, which the State of New South Wales ("the State") defended on the basis that the arrest was authorised by the Act. Mr Robinson was unsuccessful in the District Court. The Court of Appeal allowed his appeal. In this Court, the State submitted that, on a proper construction of s 99 of the Act, the Court of Appeal erred in finding that at the time of arrest the arresting police officer must have formed a positive intention to charge the arrested person with an offence. Section 99(1) stipulates conditions for arrest without a warrant, namely that "the police officer suspects on reasonable grounds that the person is committing or has committed an offence" and that "the police officer is satisfied that the arrest is reasonably necessary for any one or more" of specified reasons. Pursuant to s 99(3), a police officer who arrests a person under s 99 must, as soon as is reasonably practicable, take the person before a magistrate (or other authorised officer) to be dealt with according to law. The High Court unanimously held that in New South Wales, at common law, an arrest can only be for the purpose of taking the arrested person before a magistrate (or other authorised officer) to be dealt with according to law to answer a charge for an offence ("the single criterion"). Nothing in the Act displaced that single criterion. An arrest under s 99 can only be for the purpose, as soon as is reasonably practicable, of taking the arrested person before a magistrate (or other authorised officer) to be dealt with according to law to answer a charge for an offence. A majority of the High Court held that it followed that the constable did not have the power to arrest Mr Robinson pursuant to s 99 when, at the time of the arrest, the constable had not formed the intention to charge him. The arrest was unlawful.

HIGH COURT OF AUSTRALIA 16 May 2014 [2014] HCA 19 Today the High Court unanimously dismissed an appeal from the Court of Appeal of the Supreme Court of New South Wales, which had held that Mr Sidhu was precluded from departing from his assurances that he would transfer certain real property to Ms Van Dyke. In 1996, Ms Van Dyke and her then husband moved into a house known as Oaks Cottage, which was located on a block of land known as the Homestead Block owned by Mr Sidhu and his wife. Towards the end of 1997, Mr Sidhu and Ms Van Dyke commenced a relationship, during which Mr Sidhu gave assurances to Ms Van Dyke to the effect that he would subdivide the land and transfer Oaks Cottage to her once the site had been subdivided. Ms Van Dyke continued in her relationship with Mr Sidhu, performed unpaid work on the Homestead Block and Oaks Cottage and did not pursue gainful employment elsewhere. She also did not seek a property settlement from her husband when they divorced in 1998. In 2006, the relationship between Mr Sidhu and Ms Van Dyke came to an end and Mr Sidhu refused to transfer the property on which the Oaks Cottage sat ("the Oaks property") to Ms Van Dyke. Ms Van Dyke commenced proceedings in the Supreme Court of New South Wales, claiming that Mr Sidhu was estopped from departing from his assurances on the basis that she had acted in reliance on those representations to her detriment. The Supreme Court dismissed her claim on the basis that the trial judge was not satisfied that Ms Van Dyke had acted to her detriment in reliance on Mr Sidhu's assurances. The Court of Appeal allowed Ms Van Dyke's appeal, holding that, where inducement by the promise may be inferred from Ms Van Dyke's conduct, there was a presumption that Ms Van Dyke acted to her detriment in reliance on Mr Sidhu's representations. The Court found that Mr Sidhu had failed to rebut that presumption. The Court concluded that Mr Sidhu was precluded from departing from his assurances, and ordered Mr Sidhu to pay Ms Van Dyke equitable compensation in an amount to be assessed by reference to the market value of the Oaks property. By grant of special leave, Mr Sidhu appealed to the High Court. The High Court unanimously dismissed Mr Sidhu's appeal. The Court held that the Court of Appeal erred in proceeding upon a presumption that Ms Van Dyke had acted to her detriment in reliance on Mr Sidhu's representations. Ms Van Dyke bore the onus of proof in relation to detrimental reliance. Nevertheless, the Court concluded that Ms Van Dyke's evidence at trial established that she had acted to her detriment in reliance on Mr Sidhu's representations. On that basis, Ms Van Dyke was entitled to equitable compensation in an amount to be assessed by reference to the value of the Oaks property.

HIGH COURT OF AUSTRALIA THORNE v KENNEDY [2017] HCA 49 8 November 2017 Today the High Court unanimously allowed an appeal from the Full Court of the Family Court of Australia. The High Court held that two substantially identical financial agreements, a pre-nuptial agreement and a post-nuptial agreement, made under Pt VIIIA of the Family Law Act 1975 (Cth) should be set aside. Mr Kennedy and Ms Thorne (both pseudonyms) met online in 2006. Ms Thorne, an Eastern European woman then aged 36, was living overseas. She had no substantial assets. Mr Kennedy, then aged 67 and a divorcee with three adult children, was an Australian property developer with assets worth over $18 million. Shortly after they met online, Mr Kennedy told Ms Thorne that, if they married, "you will have to sign paper. My money is for my children". Seven months after they met, Ms Thorne moved to Australia to live with Mr Kennedy with the intention of getting married. About 11 days before their wedding, Mr Kennedy told Ms Thorne that they were going to see solicitors about signing an agreement. He told her that if she did not sign it then the wedding would not go ahead. An independent solicitor advised Ms Thorne that the agreement was drawn solely to protect Mr Kennedy's interests and that she should not sign it. Ms Thorne understood the advice to be that the agreement was the worst agreement that the solicitor had ever seen. She relied on Mr Kennedy for all things and believed that she had no choice but to enter the agreement. On 26 September 2007, four days before their wedding, Ms Thorne and Mr Kennedy signed the agreement. The agreement contained a provision that, within 30 days of signing, another agreement would be entered into in similar terms. In November 2007, the foreshadowed second agreement was signed. The couple separated in August 2011. In April 2012, Ms Thorne commenced proceedings in the Federal Circuit Court of Australia seeking orders setting aside both agreements, an adjustment of property order and a lump sum spousal maintenance order. One of the issues before the primary judge was whether the agreements were voidable for duress, undue influence, or unconscionable conduct. The primary judge set aside both agreements for "duress". Mr Kennedy’s representatives appealed to the Full Court of the Family Court, which allowed the appeal. The Full Court concluded that the agreements should not be set aside because of duress, undue influence, or unconscionable conduct. By grant of special leave, Ms Thorne appealed to the High Court. The High Court unanimously allowed the appeal on the basis that the agreements should be set aside for unconscionable conduct and that the primary judge's reasons were not inadequate. A majority of the Court also held that the agreements should be set aside for undue influence. The majority considered that although the primary judge described her reasons for setting aside the agreements as being based upon "duress", the better characterisation of her findings was that the agreements were set aside for undue influence. The primary judge's conclusion of undue influence was open on the evidence and it was unnecessary to decide whether the agreements could also have been set aside for duress. Ms Thorne's application for property adjustment and lump sum maintenance orders remains to be determined by the Federal Circuit Court.

HIGH COURT OF AUSTRALIA 5 February 2020 COMPTROLLER-GENERAL OF CUSTOMS v PHARM-A-CARE LABORATORIES PTY LTD [2020] HCA 2 Today the High Court unanimously dismissed an appeal from a judgment of the Full Court of the Federal Court of Australia concerning the classification of certain goods for the purpose of the Customs Tariff Act 1995 (Cth) ("the Tariff Act"). The Tariff Act imposes duties of customs on goods imported into Australia. Chapter 30 of Sch 3 to the Tariff Act contains heading 3004 under which medicaments consisting of mixed products for therapeutic or prophylactic uses put up in measured doses are relevantly classifiable. Note 1(a) to Ch 30 states that the chapter does not cover "[f]oods ... such as ... food supplements". Pharm-A-Care Laboratories Pty Ltd imports into Australia pastilles (referred to as "vitamin preparations" and "garcinia preparations") containing sucrose, glucose syrup, gelatin, flavours and other substances including vitamins of specified descriptions or a quantity of hydroxycitric acid. On an application for review under the Customs Act 1901 (Cth), the Administrative Appeals Tribunal ("the Tribunal") found that the vitamin preparations and the garcinia preparations were classifiable under heading 3004, with the consequence that no duty was owed on the importation of the preparations. The Comptroller-General of Customs ("the Comptroller-General") appealed from the decision of the Tribunal to the Federal Court on questions of law under the Administrative Appeals Tribunal Act 1975 (Cth). The Comptroller-General contended that the vitamin preparations and the garcinia preparations were each classifiable as either a type of "sugar confectionery", under subheading 1704.90.00, or as "food preparations", under subheading 2106.90.90, so that each was dutiable at a rate of 5% or 4%. The Comptroller-General contended that the vitamin preparations and the garcinia preparations were excluded from heading 3004 because they answered the description of "food supplements" within Note 1(a) to Ch 30. The Full Court of the Federal Court upheld the Tribunal's classification of the vitamin preparations and the garcinia preparations under heading 3004. By grant of special leave, the Comptroller-General appealed to the High Court. The High Court unanimously found that, while the Tribunal made an error of law in considering that the vitamin preparations and the garcinia preparations had to answer the description not just of "food supplements" but also of "[f]oods" in order to be excluded from heading 3004 by Note 1(a) to Ch 30, the Tribunal was correct in law in independently concluding that the preparations fell outside the description of "food supplements". The Court further held that the Tribunal did not wrongly equate the expression "food preparations" in heading 2106 with the expressions "[f]oods" or "food supplements" in Note 1(a).